Japan-US Central Bank Week: Nikkei Average Seeks Lower Ground Amid Surging Rates and Middle East Tensions

MacroDigital FinanceCommodity Impact 4
โดย ウエルスアドバイザー·JPUS·Read original
Summary · why it matters

With a Japan-US central bank week looming, Japanese equities this week saw the Nikkei Average probing lower ground, driven by a broadening set of risk factors including sharp rises in Japanese and US bond yields, hawkish remarks from a senior Bank of Japan official, and escalating Middle East tensions. Next week brings the FOMC and the Bank of Japan's monetary policy meeting, and further increases in volatility warrant caution. This week, the US 10-year Treasury yield climbed to near 5%, while in the Middle East the United States and Iran again exchanged attacks, pushing up crude oil futures. According to the FedWatch tool, the probability of a 0.25-point policy rate hike at the September FOMC stands above 70%. On the Bank of Japan, board member Masu stated that the current policy rate of 1.0% remains below the lower bound of the estimated 1.1-2.5% nominal neutral rate and is therefore still accommodative, and it was reported that at the monetary policy meeting on the 17th and 18th, some expect a hike from 1% to 1.25%. The forecast range for the Nikkei Average next week is 62,000 to 65,000 yen.

Impact on stocks 3

Others▲ · 3 stocks
％Effective Federal Funds Rate
EFFR
▲ PositiveMonetaryrelevance

FedWatch shows >70% probability of a 0.25-point hike at the September FOMC, pushing the effective fed funds rate higher.

％Japan Government Bond 10Y
JP-10Y
▲ PositiveMonetaryrelevance

BOJ board member Masu's hawkish remarks and expectations of a hike from 1% to 1.25% at the 17-18 meeting push JGB 10Y yields higher.

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