Yen steady, markets on intervention alert; Aussie up before RBA decision

economictimes.indiatimes.com:

bank policy decision. The yen was up 0.17% at 144.42 per dollar in early Asian hours, but remained close to last week's eight month low of 145.07 per dollar that prompted Finance Minister Shunichi Suzuki to warn against excessive yen selling. Earlier on Tuesday, Japan's top financial diplomat Masato Kanda said that officials were in close contact with U.S.

Treasury Secretary Janet Yellen and other overseas authorities almost everyday on currencies and broader financial markets. «This is sending signals that a coordinated intervention may be coming as yen continues to hover above 144 per dollar,» said Charu Chanana, market strategist at Saxo Markets. «A coordinated intervention usually has a longer lasting impact on the yen than a unilateral intervention would have.» Japan bought yen in September, its first foray in the market to boost its currency since 1998, as the Bank of Japan's pledge to retain ultra-loose policy as long as required drove the yen as low as 145 per dollar.

It intervened again in October after the yen plunged to a 32-year low of 151.94. Against a basket of currencies, the dollar eased 0.039% to 102.910 after data overnight showed U.S. manufacturing slumped further in June, reaching levels last seen when the nation was reeling from the initial wave of the COVID-19 pandemic.

«We expect the U.S. economy to face a recession starting in Q3 23,» Kristina Clifton, senior currency strategist at Commonwealth Bank of Australia, adding that it was likely to be a quiet day for the currency market with no major data releases or central bank speech scheduled. U.S.