ForexLive Asia-Pacific FX news wrap: USD continues to weaken


Key Economic Events and Market Updates – June 6, 2023

The foreign exchange market saw some interesting movements during Asia morning trade, with the US dollar weakening further and various currencies strengthening. The NZD/USD pair hit a 3-month high, while the EUR, AUD, GBP, CAD, and CHF all showed strength. Even the yen saw some bids, with USD/JPY dropping to around 115.40 briefly.

Despite the movement in the market, there was no significant fresh news driving these changes. Data from Australia was released, but it did not have a major impact on the FX market.

The Bank of Japan did make some notable comments, with dove on the BoJ policy board Nakamura expressing concerns about the achievement of the BOJ’s 2% price target. He believes that unless consumption picks up, this target will not be sustained beyond fiscal year 2025. Nakamura also highlighted the weak pass-through of wages to inflation, leading to weak household purchasing power and consumption. He emphasized the need for inflation-adjusted consumption to turn positive before the Bank can consider normalizing monetary policy.

Nakamura’s assessment contrasts with that of his colleague Himino from the previous day. Following Nakamura’s comments, USD/JPY saw a slight bounce back to around 155.70.

Overall, the FX market saw some interesting movements and commentary from central bank officials, indicating potential shifts in monetary policy in the future.

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