Markets continue to adopt a slightly cautious approach this week with US jobs data tomorrow. More importantly however is the slew of Central Bank Meetings next week which remain on the minds of market participants. We continue to see repricing of rate cut bets for 2024 and I expect this to continue heading into next week's meetings and possibly beyond.
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There have been some developments today with the Japanese Yen in particular providing some discussion and volatility. USD/JPY fell as much as 1.7% in the early hour following comments from BoJ Governor Ueda which was received by market participants as a possible hint of a policy pivot. I personally expect this to happen in 2024 but I am not yet convinced it will happen in Q1 as wage growth remains a stumbling block for the BoJ and Ueda.
Gold continues to remain rangebound with the US Jobs report hopefully providing a catalyst and some clarity. A deeper pullback remains possible but uncertainty and safe have flows continue to keep the precious metal supported. Later today initial jobless claims and a speech by Bank of Canada Governor Macklem may stoke volatility before attention turns to the US Jobs report.
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