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2025-08-02 19:09:26
Behind the Yen's Plummet: Is the US-Japan Trade Deal Failed? Can Hawkish Central Bank Rhetoric Reverse the Tide? ⑴ The yen has recently fallen sharply against the US dollar, raising market doubts about the US-Japan trade deal's ability to boost the Japanese economy. ⑵ Investor expectations for a Bank of Japan rate hike by the end of the year are only 70%. ⑶ At its July meeting, the Bank of Japan did not signal a strong tightening policy. ⑷ Traders are awaiting wage growth and household spending data due this week. ⑸ Strong June wage and consumption data could reignite market bets on a Bank of Japan rate hike, providing support for the yen. ⑹ In addition, the Bank of Japan's summary of its meeting, released this Friday, will also attract significant attention. ⑺ If the summary is more hawkish than Governor Ueda's previous statements, the yen exchange rate is expected to receive a boost. ⑻ Elsewhere, Chinese trade data and New Zealand's quarterly employment data are also likely to attract attention. ⑼ Of particular note, the Reserve Bank of New Zealand's latest inflation expectations will directly impact market speculation of a rate cut.
