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Fluctuations in Dollar-Yen and Euro-Dollar Exchange Rates Amidst Inflationary Concerns
The recent release of the June Producer Price Index (PPI) in the United States.
“Fluctuations in Dollar-Yen and Euro-Dollar Exchange Rates Amidst Inflationary Concerns”
The recent release of the June Producer Price Index (PPI) in the United States, which indicated a modest 0.1% year-on-year increase, falling short of market expectations, has sparked apprehensions regarding a deceleration in inflationary pressures. Consequently, the dollar-yen exchange rate experienced a transient dip below the significant 138 yen threshold during foreign market trading yesterday. Initiating the day at approximately 138 yen, the rate subsequently breached this crucial level, succumbing to considerable selling pressure and plummeting to 137.25 yen, a level unseen since May.
Following this downturn, a midday recovery materialized, leading to an upturn towards the 137.60 yen level. However, during the afternoon session, a slightly prevailing trend of yen buying emerged, causing the exchange rate to retreat to approximately 137.30 yen. As the London trading session approached, a surge in buying activity ensued, propelling the rate to the 137.80 yen level. Nonetheless, it remained below the preceding day’s foreign market low, underscoring the persistent notion of a feeble dollar and a robust yen.
Supported by the upward momentum reaching the 1.1220 range and the overall weakness of the US dollar, the euro-dollar exchange rate endeavored to test higher thresholds. While a minor correction transpired in the morning, with a decline to 1.1214, subsequent buying pressure on the euro against the dollar emerged later in the day, propelling the rate to 1.1243. Concurrently, the acquisition of euro-yen positions contributed to bolstering the euro-dollar exchange rate, aligning with the repurchase of dollar-yen pairs.
Nevertheless, the euro-dollar rate confronted renewed selling pressure, breaching the 1.1220 level.
Meanwhile, the euro-yen exchange rate initially traded around 155 yen in the morning, reflecting the downward trajectory observed in the dollar-yen pair. Subsequently, it descended to the 154.10 yen level; however, it experienced a resurgence of buying interest, triggering a partial recovery.
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