ForexLive Asia-Pacific FX news wrap: Reverberations from the US CPI report in Japan, China

• JP Morgan on the US CPI – the “sound of the door slamming shut on a June rate hike”
• Federal Reserve speakers Thursday include Williams, Barkin, Collins, Bostic
• Japan chief cabinet secretary: Won’t rule out any steps to respond to excessive FX move
• Morgan Stanley & Goldman Sachs have both lifted their forecasts for China economic growth
• Refresher on the bind the PBoC is in on the weak yuan -don’t want to trigger a crash
• China March CPI -1% m/m (-0.5% expected)
• PBOC sets USD/ CNY reference rate for today at 7.0968 (vs. estimate at 7.2622)
• Wall Street Journal fed insider: Fed Rate Cuts Are Now a Matter of If, Not Just When
• More from Japan finance minister Suzuki : Forex levels are basically determined by markets
• Australian consumer inflation expectations have jumped higher in April to 4.6% (from 4.3%)
• Japan finance minister Suzuki trying to talk up the yen now – verbal intervention
• Still a chance of a June rate cut – but from the European Central Bank
• Japanese Government Bond yields jump higher, highest since November
• Asia Development Bank raises China growth forecast for 2024 to 4.8% (from 4.5%)
• China’s Auto Exports Set Monthly Record in March
• Atlanta Federal Reserve says Sticky Price Consumer Price Index +5% yy in March (prior +4%)
• Japan’s Kanda says prepared to necessary steps on rapid yen fall
• Responses to CPI saying its in components the Fed cannot control with rates are misguided
• US SEC targeting another crypto platform, Uniswap Labs facing potential enforcement action
• ICYMI – Goldman Sachs pushes Fed rate cut call to July (from June)
• Wells Fargo expect only 2 Fed rate cuts this year, one each in Q3 and Q4
• BlackRock’s head of global fixed income says Fed rate cuts probably late in 2024 or beyond
• Forexlive Americas FX news wrap: US CPI runs hot, Bank of Canada holds rates
• USD/JPY pops up through 153.00. Hits its highest since July 1990.
• When FOMC minutes go stale even before they are published
• US CENTCOM Commander prepares for potential Iran attack on Israel
• US stocks close lower after higher than expected CPI
• Trade ideas thread – Thursday, 11 April, insightful charts, technical analysis, ideas

The
March US CPI report came in higher than expected, rocking markets
during US hours. Reverberation continued here during Asia today.
USD/JPY had climbed above 153.00 in late US trade and it was sitting
just below the big figure as Japan became active. We had verbal
intervention aimed at supporting the yen from Japan’s Vice Finance
Minister for International Affairs Kanda, from Japan’s Finance
Minister Suzuki, and from chief cabinet secretary Hayashi. USD/JPY
has dribbled a little lower, to around 152.80. The statements we had
from these officials were not overly aggressive and didn’t hint at
any imminent actual yen-buying intervention. The next step should be
a raising of the aggressiveness of commentary, followed by ‘rate
checks’ and then actual intervention.

Also
of note today in response to market moves was the reference rate
setting for USD/CNY from the People’s Bank of China. The PBOC
set
the USD/CNY central rate a whopping 1654
pips stronger (for
CNY)
than the
Reuters
estimate. This
is the biggest discrepancy ever, with records back to 2018. The
People’s Bank of China is set on not letting the yuan devalue. I
posted (in the bullets above) my “Refresher on the bind the PBoC is
in on the weak yuan – don’t want to trigger a crash”.

Also
from China today we had very soft inflation data. Consumer
prices barely increased from a year earlier and the
PPI showed that industrial
prices continued to slump. There
is still ongoing deflationary
pressures in
China’s economy.

Major
FX rates are little net changed on the session here. Traders are now
awaiting the European Central Bank meeting, where no change is
the wide expectation.

Regional equities followed Wall Street’s lead lower.

Oil prices remained bouyed by fears of Iran retaliation.

This article was written by Eamonn Sheridan at www.forexlive.com.