Yen Crushed as Super-Long JGB Yields Plunge on Supply Cut Speculation
| Action Insight Mid-Day 5-27-25 |
Yen Crushed as Super-Long JGB Yields Plunge on Supply Cut Speculation |
Yen is under intense selling pressure today, dragged down by a sharp plunge in super-long JGB yields. The 30-year yield closed at 2.836%, down significantly from 3.165% just days ago. This abrupt move followed a Reuters report suggesting that the Ministry of Finance may reduce super-long bond issuance as part of a potential tweak to its bond program. Discussions with market participants are expected to conclude by mid- to late-June, after which the MOF will formalize its decision. The reported consideration comes in response to a surge in super-long yields to multi-decade highs, which had mirrored global trends, particularly a selloff in US long bonds. A reduction in supply could help stabilize Japan's long-end, which has come under additional pressure amid political calls for fiscal stimulus ahead of July’s upper house elections. Prime Minister Shigeru Ishiba faces growing demands for tax cuts and expansive spending measures, both of which could further exacerbate Japan's already heavy debt load and add pressure on government financing costs. This bond market adjustment has compounded Yen weakness, particularly as global risk appetite revives. European equities are rallying, with DAX hitting a fresh record high, and US equity futures are pointing higher as well. This upswing in sentiment is fueling a rebound in Dollar, while Euro and Sterling are also firming against most peers. In contrast, the Swiss franc is underperforming, second only to Yen on the downside today. However, commodity currencies like Aussie, Kiwi and Loonie are showing muted reactions, failing to capitalize on the improved mood.... |
USD/JPY Mid-Day Outlook Daily Pivots: (S1) 142.35; (P) 142.72; (R1) 143.20; More... USD/JPY recovered notably today but stays below 144.31 minor resistance. Intraday bias remains neutral first. On the upside, firm break of 144.31 will argue that fall from 148.64 has completed as a corrective pullback. Intraday bias will be turned back to the upside for 148.64 resistance next. Nevertheless, rejection by 144.31 will keep risks on the downside. Below 142.10 will target a retest on low. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 23:01 | GBP | BRC Shop Price Index Y/Y May | -0.10% | 0.00% | -0.10% | | 23:50 | JPY | Corporate Service Price Index Y/Y Apr | 3.10% | 3.00% | 3.10% | 3.30% | | 06:00 | CHF | Trade Balance (CHF) Apr | 6.36B | 5.55B | 6.35B | 6.29B | | 06:00 | EUR | Germany GfK Consumer Sentiment Jun | -19.9 | -19.7 | -20.6 | -20.8 | | 09:00 | EUR | Eurozone Economic Sentiment May | 94.8 | 94 | 93.6 | | 09:00 | EUR | Eurozone Industrial Confidence May | -10.3 | -11 | -11.2 | -11 | | 09:00 | EUR | Eurozone Services Sentiment May | 1.5 | 1.4 | | 09:00 | EUR | Eurozone Consumer Confidence May F | -15.2 | -15.2 | -15.2 | | 12:30 | USD | Durable Goods Orders Apr | -6.30% | -8.00% | 7.50% | | 12:30 | USD | Durable Goods Orders ex Transport Apr | 0.20% | 0.00% | -0.40% | | 13:00 | USD | S&P/CS Composite-20 HPI Y/Y Mar | 4.50% | 4.50% | | 13:00 | USD | Housing Price Index M/M Mar | 0.20% | 0.10% | | 14:00 | USD | Consumer Confidence May | 87.1 | 86 |
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