Japanese Yen Steady ahead of Tokyo Core CPI

Japan releases Tokyo Core CPI, considered the most important inflation indicator, on Tuesday. The index fell to 1.6% y/y in January, below expectations and the lowest rate since May 2022, but the market estimate for February stands at 2.5%.

Could Tokyo CPI Open the Door to BoJ Policy Normalization?

The market has already started the countdown to the March central bank meetings. The ECB gathering is scheduled for this Thursday while the Fed will meet on March 20. With the market speculating on the likely start date of the rate cutting cycle by the two heavyweights, the Bank of Japan is still trying to make its first step towards monetary policy normalization.

Will Bank of Canada Pave the Way for a Rate Cut after CPI Drop?

The Bank of Canada heads towards its second policy meeting of the year with some good news on the inflation front. The consumer price index eased to 2.9% y/y in January from 3.4%, falling below 3.0% for the first time since June 2023 when the disinflation process came to a pause.

Will NFP Report Confirm Fed's 'Higher for Longer' Mantra?

At its latest gathering, the FOMC appeared less dovish than expected. Policymakers decided to left interest rates untouched and dropped a longstanding reference to the possibility of further hikes. Nonetheless, they noted that it may not be appropriate to lower interest rates until they gain confidence that inflation is moving sustainably towards the 2% target. At the press conference, Fed Chair Powell was more specific, noting that a March rate cut was not the Fed’s “base case.”

US 500 Battles With 123.6% Fibonacci

The US 500 stock index (cash) has been staging an impressive rally since it bottomed out in October 2023, generating consecutive all-time highs. Given that the price is trading into uncharted waters, the Fibonacci extensions of its most recent downtrend could provide potential future resistance zones.

Two Drivers of Crypto Growth

Crypto market capitalisation rose 5% in 24 hours to $2.44 trillion, driven by extreme greed. The crypto market had a higher capitalisation for a few days in May and October-December 2021, but that was in an ageing bull market compared to a relatively young one now.

Did Oil Find Its Way Up?

Oil is correcting 0.2% on Monday after closing almost 2% higher on Friday and peaking at 3.4%. WTI’s high of $80.3, last seen in November 2023, and a consolidation above $79 would indicate a break of long-term horizontal resistance, something the bulls have failed to do over the past four months.

Euro Area and Nordic Countries to Gradually Move Out of Their Current Stagnation

In the euro area, the Sentix Indicator measuring investor confidence rose to -10.5 from -12.9 in line with expectations. The reading marks an 11-month high for the indicator, albeit it remains well below its long-term average.

Bitcoin Will Have to Settle Here

Bitcoin peaked at $68,789, just $122 below its historical high. This is before the halving and before the final capitulation of buyers, typical of the weeks leading up to the halving, when some miners leave the market and sell coins.

Japanese Yen Yawns as Tokyo Core CPI Jumps

Today’s release of Tokyo Core CPI, which excludes fresh food and is considered Japan’s important inflation indicator, had no effect on the Japanese yen, as February’s gain of 2.5% y/y was in line with market expectations. Still, this marked a significant jump after the revised 1.8% gain in January. The ‘core core’ CPI release, which strips away fresh food and fuel costs, dipped to 3.1% in February, down from 3.3% a month earlier.