Japan raises Interest rates

 Japan today raised the interest rates to 0.25 bps from the previous rate of 0.1 bps.

It was necessary looking at weakness Yen has shown since U.S. Federal Reserve began Quantitative tightening.

Over three quarters economists from Reuters Poll predicted that Bank Of Japan won't raise interest rates, but they did it anyways 

This raise in interest rates came after the biggest minimum wage hike. This salary raise will cushion the pressure that might come from inflation rise. 

India's FX Reserve is rising but at what cost?

 

India's FX reserve has increased significantly in last 2 years. But will this help Rupee to retain its previous levels or has India lost its territory of 76?

 

July 11th, 2024 - BOJ intervention and U.S. CPI data

 

U.S. CPI data released. It touched 3.00. However, it has failed to breach 3 level. Last year July it was at the similar level and from August it bounced back. 

It will be interesting to watch how the CPI data behaves next month. 

Besides CPI, another interesting thing is the intervention by Bank Of Japan.

The price is a significant move. This alone could not be due to CPI. Seems BOJ took advantage of the low CPI and might have intervened. 

INR weakens when Quantiative easing begins.

 We are not too far from when Fed will realize that it's time to end the pause and start Quantitative easing. 

If it happens we start to see the Rupee weaken further.