[Week of June 15 onwards – Foreign exchange market outlook] This week, the biggest milestones are the Bank of Japan and the FOMC
【Week of June 15 onwards: Exchange rate outlook】This week’s main events are the Bank of Japan and the FOMC
This week’s forex market focus is the Bank of Japan policy meeting on the 16th and the FOMC (U.S. monetary policy announcement) on the 17th
In particular, this time the press conference by Chair Powell, who is said to be at his first since taking office, and the SEP/dot plot showing FOMC participants’ rate outlook will be released, raising market volatility concerns
Key Focus ① The dollar direction could be decided at the FOMC
The star of this week is the FOMC on the 17th
The market has almost priced in keeping policy rates unchanged, but
the outlook for cuts later this year
inflation expectations
economic outlook
the dot plot
changes in these could lead to large moves in the dollar
Also, attention is on how Chair Powell will stance himself on future monetary policy
If a cautious stance toward cuts is shown, dollar buying may occur,
if caution about economic slowdown is strengthened, it could lead to dollar selling
Key Focus ② BOJ meeting and the yen market
At the BOJ meeting on the 16th, no policy change is expected
However,
purchases of government bonds policy
price outlook
recognition of yen weakness
are in focus
This time, Deputy Governor Uchida will hold the press conference due to Governor Kuroda’s hospitalization
If the market interprets it as being inclined toward additional hikes, yen buying may dominate,
if the stance is cautious, yen selling may prevail
Key Focus ③ USD/JPY and intervention risk tug-of-war
USD/JPY remains high,
dollar buying driven by rising U.S. yields
Japan’s intervention risk
continues
If dollar buying strengthens after the FOMC, there is a possibility of moving back up, but high-price chasing carries intervention risk
Key Focus ④ Middle East tensions and oil prices
Tensions in Iran continue, and their impact on the oil market cannot be ignored
If Middle East risk rises,
higher oil prices
reignition of inflation concerns
higher-for-longer interest rate expectations
could become drivers of dollar and gold price volatility
This week, headlines related to geopolitical risk should also be watched
This week’s notable schedule
Tuesday 16
BOJ policy announcement
Deputy Governor Uchida press conference
RBA policy announcement
Wednesday 17
U.S. retail sales
FOMC
SEP (dot plot)
Powell press conference
Thursday 18
SNB policy announcement
BOE policy announcement
U.S. initial jobless claims
Friday 19
Japan nationwide CPI
U.S. markets closed
This week’s summary
This week is an important week where the market direction will be determined by the flow from “BOJ → FOMC.”
In particular, USD/JPY will move in the order of
① BOJ meeting
↓
② U.S. retail sales
↓
③ FOMC, SEP, and Powell press conference
In the latter half of the week, there is a possibility of big moves as these catalysts concentrate
The market, which has lacked a clear directional trend for the past few weeks, may see the birth of a new summer trend, which is the main attraction
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