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07-05-2024, 08:45 AM
Japan's foreign exchange buying, which was repeated two days later on May 1, is likely to have been worth US$40 billion in central bank reserves.
“The yen remains at the mercy of the US Federal Reserve,” Skylar Koning, a senior macro strategist at TS Lombard, said. “Dollar strength is a destabilising force globally.”
The greenback has appreciated 8% against the yen this year and is 4% stronger on a trade-weighted measure against a basket of major currencies.
Companies and governments who have also borrowed in dollar-denominated debt face punishing debt servicing costs when their local currencies slide against the greenback.
According to one study, a one-point monetary policy tightening shock in the US economy reduces industrial production in advanced economies by 1.5% on average.
The reason is because the USD is the world trading currency.
https://www.thepost.co.nz/world-news/350...ross-globe
“The yen remains at the mercy of the US Federal Reserve,” Skylar Koning, a senior macro strategist at TS Lombard, said. “Dollar strength is a destabilising force globally.”
The greenback has appreciated 8% against the yen this year and is 4% stronger on a trade-weighted measure against a basket of major currencies.
Companies and governments who have also borrowed in dollar-denominated debt face punishing debt servicing costs when their local currencies slide against the greenback.
According to one study, a one-point monetary policy tightening shock in the US economy reduces industrial production in advanced economies by 1.5% on average.
The reason is because the USD is the world trading currency.
https://www.thepost.co.nz/world-news/350...ross-globe
