The Monday Brief: The Week Washington Bought Yen
Tokyo spent a record. Washington sold euros. The long end sold off anyway.
Your Monday compass. What's on my screen, why, and what would change my mind. In your inbox before the open, and four minutes start to finish.
Yesterday we sorted the AI build's promises by which ones are actually binding. This week two treasuries teamed up to support one currency.
WHAT MOVED
Starting with Thursday. Japan bought yen and USD/JPY fell three percent in about an hour. Bloomberg puts the day’s spend near ¥8.45 trillion, or about $52.8 billion, on an estimate built from BoJ accounts. That would be Tokyo’s largest ever in a session. Then on Friday, Washington joined. The Financial Times reported the New York Fed sold euros for yen on the Treasury’s behalf, through Goldman and Morgan Stanley. How much Washington bought is still not reported, and the official record of it does not land until the New York Fed's quarterly report in November.
The Fed held overnight rates Wednesday at 3.50 to 3.75, on a 9 to 3 vote. Hammack, Kashkari and Logan all preferred a quarter point. June was 12 to 0. The statement itself changed by exactly one word. And the long end sold off anyway, the thirty-year at 5.267%, its highest since 2007.Okay, that’s what we’re going to do. We’ll keep it at four minutes. I’ll move the paywall to after the new header “The Week Ahead”. We’ll test that this week and see how it does.
