 Yen rebounded broadly today as market participants interpreted comments from BoJ Governor Kazuo Ueda as a potential signal for a rate hike in December. Ueda noted that there is still a month before the next policy meeting and that the central bank will have a substantial amount of data to consider by then. While he did not commit to any policy changes or express a clear intention to adjust interest rates, this "openness" was well-received by Yen bulls. The mere possibility of BoJ adopting a more hawkish stance provided enough impetus for Yen to strengthen against its peers. In contrast, Euro declined broadly, breaking to the downside against both Aussie and Loonie, although it remained range-bound against Dollar. ECB attempted to downplay the significance of the previous day's stronger-than-expected wage growth data, which is a clear indication that they are prepared to deliver another rate cut in December. Notably, one of the known dovish members of ECB Governing Council suggested the idea of continuous rate cuts until the deposit rate reaches neutral level of 2%. While it may be premature to project policy that far ahead, it appears that some officials are already setting the stage to manage market expectations for the coming year.... |
