美联储加息25基点，市场预期日本央行将跟进收紧

[music] Bloomberg Audio Studios podcasts radio news. [music] Welcome to the Daybreak Asia [music] podcast. I'm Doug Krishnner. So, the Fed raised interest rates by a quarter percentage point on Wednesday. That move was widely expected by markets. Policy makers also penciled in an additional rate hike later this year. Obviously, the goal here is to contain inflation. Today's decision, if you're wondering, was unanimous.

Here is Chair Kevin Worsh.

I would be hardpressed to describe broad financial conditions as restrictive. This view was widely shared by the committee. So, we removed a dose of accommodation. Consider the geopolitical landscape of shocks and uncertainty and you begin to appreciate the resilience of the US economy. In fact, Worsh went on to say the American economy appears to be strengthening. So, the Fed funds rate is now in a target range of 3 and 3/4 to 4%.

The White House described the decision as rather unfortunate. And later in the day, in a post on Truth Social, President Trump said rates should be 1% or less because the US has the best credit in the world. And he went on to say the Fed should lower rates fast. For a closer look, let's bring in Bloomberg's David Finity. David is a markets live FX strategist and he joins from our studios in Singapore. Thank you for being here.

Give me your reaction to everything that unfolded. Uh well, it was very interesting. It was obviously highly anticipated. I think going into it, the market pricing was certainly very hish. They were looking for basically three three and a half hikes including one yesterday. Um and if you look at it, so what did happen? The Fed raised that was expected. The dot plot signaled uh one more hike this year and then signaled maybe flat next year or maybe one more hike.

So a total sort of two more RTS hike which is not quite as hawkish as the market looked but the market said normally that would mean okay well you've disappointed us. Ironically, what happened on this time is after Fed's Fed chairman's Walsh's comments, the market said, you know what? We're not our our pricing is not hish enough. We should price in more. So now you've got the market actually pricing in three more Fed hikes basically through June, July next year, uh with the first one in December, even though the Fed dot plot signals one maybe two.

Um you know, so it's very interesting. you've had normally it will go the opposite way around the market will adjust down to what the dot plot and but obviously what Fed Walsh chairman said Walsh said they said okay he's on ball now and uh we're going to be hiking so they actually were happy to run with it even though the dot plot didn't say that so a slight discrepancy there it'll be interesting to see how that works out obviously we'll need more data to see how that plays but certainly December right hike is fully baked in and Fed with chairman Walsh doesn't like forward guidance but that dot plot was pretty blatant when you had basically 16 of 18 people saying one hike of which four of 16 said maybe uh two hikes by year end.

So if you look at the behavior of the dollar David that was clearly the interpretation of the market. I think the Bloomberg dollar spot index popped about a half of 1% flip side produced a much weaker yen. I think the yen was considerably weaker in New York trading down about 8/10 of 1% or so. So talk to me now about what this means for the Bank of Japan. The BOJ meets on Friday. What does the BOJ have to do if you consider the fact that the yen was struggling quite a bit in New York trading?

Well, I think now you've said the bull's definitely in BOJ's court and I think especially the governor's press conference. The market pricing for the BOJ is very hish as well. We're looking for a hike tomorrow and another three hikes basically by July. So and then they they're looking for like a hike tomorrow and pretty much one every 3 months from now. So again normally okay you have to meet expectations Bank of Japan if you don't normally we will punish you.

Um and therefore it's governing way who historically he's not been great at sounding uber hawkish shall we say but again the mark expectations are this is what we factored into this so you don't deliver this or you disappoint us a lot we will penalize you by weakening the end. So I think at the end of the day given the Fed has from the market perspective of your dollar yen long um the Fed's come out as hawkish certainly the markets interpreted as very hawkish and now the question is can the BOJ live up to its expectations given governor said his history I'm not sure if it can be you know he can signal one hike for every three quarter every three months for you know through mid year maybe he can but um historically he's not been an uber a hawkish guy.

So there is a likelihood from what I'm hearing that the BOJ could disappoint relative to market expectations and then I'm thinking okay so the yen weakens to the 160 level pretty quickly. Is that a possibility?

I don't know. So I definitely think look if they disappoint it certainly pushes higher. I think you get to the 157s way 158s. Um I don't think quite enough to get to the 160 because I think the dollar side equation is baked in. And if anything, maybe I said given the difference in expectations between what the market's looking than what the Fed's saying in this dot plot, maybe the market's gone a bit too aggressive on that pricing.

So you're going to need quite a lot of data or oil to push higher to to, you know, to confirm the market pricing. So on dollar side of the equation, not much there. The end side of the equation, I said if they weaken, I think you can get to maybe 158. Beyond that, I don't know. It was interesting. And I was talking to a trader before I came down here and he was saying a lot of the markets like trying to work out okay at what level does uh you start buying yen again.

So not dollar yen buying yen again.

So the idea in terms of you know shorting dollar yen is attractive to the market. You've seen a bunch of unwinds over basically heavily this week. They started happening certainly post that USCPI data and ahead of the Fed and they continued yesterday um post Fed. But now the interesting thing the market really is this sentiment of okay when do we reload dollar yen short. So what could happen tomorrow is if the BOJ does disappoint people may say hey that's an opportunity if it's around 158 to go let's get back in this trade again.

So do yen funded carry trades then remain a safe bet for a while longer do you think?

I think look with the rate differential a yen as a carry funder is always going to exist. What you don't want ideally is if you're doing that is the yen then to strengthen heavily strongly. Now we've certainly seen that over the last you few weeks it went from 158 down to 152 and change. Um so you are wary of that but I think at the end of the day yen is always going to be an attractive cy funder because even with them raising rates they're still compared to other ones very low.

Every other central bank is supposed to raise rates aggressively as well. So you're looking at the yen, Swiss Franks could be an attractive funer because you know SMB's certainly in no hurry to go in coming months certainly this year um and they certainly defend against uh Swiss Frank strength strength. So that's a potential one maybe the Swedish croners a little bit but you know you want a liquid currency and the yen is certainly be attractive.

So I think you know the yen as a as a carry funer is not going to disappear. Whether other ones will become a bit more attractive such as Swiss Frank is debatable. But yes, I do think the yen carry trades don't vanish overnight. I'm curious to get your take on the intervention risk that that is in the market right now and whether or not if we do flirt with a level of 160 uh dollar yen that perhaps um Treasury Secretary Besson might come back to the mar