October 3, 2022

Fed hikes, Bank of Japan, interest rates, currencies

Japanese Yen strengthens on reports officializing FX intervention

The Japanese yen strengthened more than 2% against the dollar after reports from authorities announcing direct intervention to protect its currency.

This comes after the yen weakened to 145-levels against the greenback after the Bank of Japan decided to keep its rates steady.

Japanese Deputy Finance Minister for International Affairs Masato Kanda told reporters that authorities had taken “decisive action” on the exchange market, Reuters reported.

– Jihye Lee

Oil rises after Fed rate hike, demand fears linger

Oil prices rose following the central bank’s third consecutive rate hike.

Even Reuters Chinese refiners said The country expects to release an export quota of 15 million tonnes worth of oil products for the rest of the year, citing people with knowledge of the matter.

Brent crude futures It rose 0.45% to $90.24 a barrel American West Texas Intermediate It rose 0.45% to $83.3 a barrel.

– Lee Ying Shan

Fed hike could keep Asian risk assets under pressure, says JP Morgan

According to Tai Hui, chief APAC market strategist at JPMorgan Asset Management, Asian risk assets, particularly export-oriented companies, will remain under pressure in the short term following the central bank’s rate hike.

Tai added that a strong US dollar is likely to persist, but tightening monetary policy at most Asian central banks – except for China and Japan – will help limit the extent of Asian currency depreciation.

The US dollar indexTracking the greenback against a basket of its peers, it strengthened sharply and last traded at 111.697.

– Abigail Ng

Bank of Japan steady, yield curve stands by containment policy – Yen crosses 145

The Bank of Japan kept interest rates on hold – meeting expectations – according to an announcement on its website Economists in a Reuters poll.

The Japanese yen weakened to 145 against the greenback shortly after the decision.

“Although affected by factors such as rising commodity prices, while public health has been protected from Covid-19, Japan’s economy has picked up as economic activity resumes,” the central bank said in a statement.

Jihye Lee

CNBC Pro: This fund manager beats the market. Here’s what he’s betting against

Stock markets have fallen, but funds managed by Patrick Armstrong at Plurimi Wealth continue to deliver positive returns. A fund manager has multiple short positions to play market volatility.

Pro subscribers can Read more here.

– Javier Ong

Asian currencies weakened after the central bank’s third straight big hike

Asia-Pacific currencies weakened further after the US Federal Reserve hiked by 75 basis points for the third straight time.

Coast of China Yuan It weakened past 7.09 per dollar, near levels not seen since June 2020.

The Japanese Yen Korean weakened to 144.51 won 1,409 against the greenback – the weakest since March 2009.

The Australian dollar fell to $0.6589.

– Jihye Lee

The U.S. 2-year Treasury inched toward its 2007 peak

The British pound fell further to a 37-year low

The British pound It fell further in morning trade in Asia to hit $1.1217 – its lowest level since 1985.

The currency has been falling against the US dollar this year as economic worries mount.

Analysts are divided Will the UK central bank raise rates by 50 basis points or 75 basis points later today?

Sterling last traded at $1.1223.

– Abigail Ng

CNBC Pro: Morgan Stanley’s Mike Wilson names key attributes he likes in stocks

Morgan Stanley’s Mike Wilson remains on the defensive amid continued market volatility this year. He names the key attributes he looks for in stocks.

According to Wilson, stocks with this characteristic have been “rewarded” this year.

Pro subscribers can Read more here.

– Javier Ong

Bank of Japan likely to maintain yield curve control through 2022: DBS

Substantial changes in the Bank of Japan’s policies are likely only after the central bank’s leadership changes in mid-2023, TBS Group Research said in a note on Tuesday.

But the BOJ could consider some “policy finetuning,” such as widening the target band by 10 basis points in response to market pressures, analysts wrote.

That’s “regardless of intervention,” he added dollar-yen It could test 147.66, last seen in August 1998, and they’re not ruling out a push for USD/JPY above 150 “without a hard landing that could trigger Fed cuts in the US.”

– Abigail Ng

Stock futures open lower

U.S. stock futures fell on Wednesday night following a volatile session in major averages as traders weighed another big rate hike from the Federal Reserve.

Dow Jones industrial average futures were down 16 points, or 0.05%. S&P 500 and Nasdaq 100 futures were down 0.19% and 0.31%, respectively.

– Sarah Min

As stocks slide, the Dow closes 522 points lower in a volatile trading session

Stocks were mixed on Wednesday, but ended the session in the red after the Federal Reserve announced another 75 basis point rate hike.

The Dow Jones industrial average closed down 522.45 points, or 1.7%, at 30,183.78. The S&P 500 fell 1.71% to 3,789.93, while the Nasdaq Composite dove 1.79% to 11,220.19.

– Samantha Subin