Skip to Content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
More View More
Japanese Yen, Aussie Dollar Fall on Firming Fed Rate Hike Outlook

Japanese Yen, Aussie Dollar Fall on Firming Fed Rate Hike Outlook

Ilya Spivak,
What's on this page


  • Yen falls as Fed boosts global rates, hurting the go-to funding currency
  • Aussie Dollar down on bets US Dollar yield advantage to widen further
  • A speech from the Fed’s Bostic, US PPI data unlikely to bring fireworks

The Yen underperformed in Asia Pacific trade, falling alongside gold prices while front-end US Treasury yields rose. Realized and expected Fed interest rate hikes have bid up borrowing costs globally since close to 80 percent of all monetary transactions are settled in USD. Bets on more of the same after a hawkish speech form Chair Powell are thus understandably negative for the low-yielding Japanese unit as the emerging environment encourages build-up of JPY-funded carry trades.

The Australian Dollar also declined. This too coincided with the upshift in US yields and seems to reflect the likelihood that the greenback will open a widening lead against its Aussie namesake on the top end of the G10 FX rates spectrum as the Fed continues to tighten while the RBA stands pat. Priced-in expectations don’t see Governor Lowe and company following the Fed’s lead until February 2019 at the earliest.

Looking ahead, a lull on the European economic data docket shifts the spotlight to a somewhat lackluster offering of US event risk. April’s PPI figures are expected to show a slowdown in wholesale inflation and Atlanta Fed President Rafael Bostic is due to speak. The former may pass without fireworks as the higher-impact CPI report looms ahead. Meanwhile, Mr Bostic’s cautious posture has been well-telegraphed already. On balance, a day of consolidation may be in the cards.

See our quarterly FX market forecast s to learn what will drive prices through mid-year!


Asia Pacific Trading Session Economic Calendar


No data.

** All times listed in GMT. See the full economic calendar here.


--- Written by Ilya Spivak, Currency Strategist for

To contact Ilya, use the comments section below or @IlyaSpivak on Twitter

To receive Ilya's analysis directly via email, please SIGN UP HERE

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.