USD/JPY & Intervention Watch:
USD/JPY remains one of the key focal points across FX markets as the pair continues to trade near the line-in-the-sand level of 160.00. Investors remain alert to the possibility of official Japanese intervention should the pair break higher.
Middle East & Oil Markets:
Geopolitical tensions escalated overnight after the US launched strikes against Iranian targets following an attack on a US military helicopter attributed to Iranian-backed forces. Despite the increase in tensions, oil prices fell 2.1%, from $94.25 to $92.17 per barrel, as markets assessed the limited impact on physical supply while broader demand concerns continued to weigh on sentiment.
Bonds & Fed Expectations:
US Treasury yields declined during the session, with the 10-year Treasury yield falling to 4.53%. Markets remain focused on today's US CPI release, which is expected to provide further guidance on the Federal Reserve's policy path and the timing of any future rate cuts.
Gold:
Gold came under significant pressure, falling 1.59% to $4,258. The decline was driven by profit-taking and a stronger US dollar, with investors reducing exposure ahead of today's key US inflation data despite ongoing geopolitical tensions in the Middle East.
Economic Calendar
Today:
- US CPI (YoY)
- US Core CPI (YoY)
- US CPI (MoM)
- US Core CPI (MoM)
- US EIA Crude Oil Inventories
- US Monthly Budget Statement
Key Market Moves Today
- S&P 500 Futures: -0.37% ($7,365)
- US 10-Year Yield: +2.38 bps (4.54%)
- Brent Crude: +0.67% ($92.06)
- Bitcoin: -1.13% ($61,417)
- Gold: -1.86% ($4,181)
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