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The story of the day in financial markets is the USDJPY pair, after it moves above the 137.00 level with relative ease and traded back to levels not seen since September 1998.
Bank of Japan Kuroda reiterated his view today that the central bank continues to support keeping printing in place, i.e. QE in place, with no signs of raising rates.
The elections over the weekend confirmed the publics approval as they voted to keep the political status quo, which has ignited markets view that further yen weakness is coming.
Watch out for further strong USDJPY gains this week, especially if the CPI on Wednesday points toward another 75-basis point hike when the Fed decides their next decision on July 27.
In other market main market news this afternoon, the Kansas City Federal Reserve President Esther George, who actually voted against the 75-basis points rate hike in June, argued today that the pace of rate increases needs to be carefully balanced against the state of the economy.
This has failed to give equity markets a jolt, or even cause the DXY breakout to slow today. Usually, such news from a Fed member would have a bullish effect on stocks.
In regard to the DXY breakout, which actually reach 108.00 today, the move today has gathered a gain of over one percent and move the US dollar index to levels not seen since 2022.
Sterling is also taking a hit today as the DXY ramps higher and uncertainty remains in UK politics. The euro currency is also under pressure due to fears over energy.
The biggest single pipeline, known as Nord stream, carrying Russian gas to Germany began annual maintenance on Monday, with flows expected to stop for 10 days, as governments, markets and companies are worried the ongoing war in Ukraine.
Additionally, a court in southern Russia on Monday overturned an earlier ruling suspending Caspian Pipeline Consortium’s operations and instead fined it 200,000 roubles.
Crude oil prices are trading down one percent so far in the US session. Oil prices are particularly volatile ahead of the July 13th meeting between the Presidents of Russia and Ukraine.
Cryptos continue to track broader equity markets. Bitcoin is moving back towards the $20,000 level after last week post its strongest weekly gains since March this year.
