• USD/JPY peaked at 154.66 Thursday, it has slipped from 154.61 to 153.97 on Friday

• Fin Min Katayama stressed Japan's close cooperation with US on FX

• Spot continues to trade below 154.78 Fibo, a weekly close below would be bearish

• 154.78 Fibo, a 38.2% retrace of the 139.89 to 163.99 (April to July) EBS rise

• USD/JPY and EUR/JPY tend to move in tandem, log correlations are high above +0.5

Daily Chart


Daily Chart


Correlation Chart

(Martin Miller is a Reuters market analyst. The views expressed are his own)

• AUD/USD holds below 0.72 before US August CPI data at 1230 GMT

• 0.71505-0.71752 is Friday range-to-date (0.71505 is low since Sept 2)

• US CPI forecast up 0.4% MM, 3.4% YY. Core f/c up 0.2% MM, 2.4% YY

• Hotter prints could increase probability of Fed hike next week, lift USD

• 10-year UST yield rose to 4.97% in Asia, highest level since 2023

• Citi expects RBA to raise rates twice before 2027 (next decision Sept 29)

AUDUSD

(Robert Howard is a Reuters market analyst. The views expressed are his own)

• Cable rises to 1.3527 as pound gains on unexpectedly positive UK July GDP

• Up 0.4% vs zero forecast. 1.3527 is intra-day high (1.3499 was Asia low)

• 1.3527 is six pips shy of rally high from Thursday's 1.3493 intra-week low

• UK July GDP beat is boost for hawks advocating BoE rate hike in Q4

• US CPI data due at 1230 GMT; 0.4% MM, 3.4% YY f/c. Core f/c 0.2% MM, 2.4% YY

• Hotter CPI prints could increase risk of Fed rate hike next week, inflate USD

GBPUSD

(Robert Howard is a Reuters market analyst. The views expressed are his own)

• EUR/USD on back foot on broadly strong USD, Asia 1.1607-17 EBS

• Higher crude, inflation concerns cited, despite hawkish ECB view

• EUR/USD off from 1.1654 high Wednesday, to 1.1592 low yesterday

• Back below 200-DMA at 1.1633 but still above 100-DMA down at 1.1558

• Spot also below 1.1614 200-HMA now, 100-HMA above at 1.1625

• Massive E6.7 bln option expiries today between 1.1500-1.1600 supportive

• Total E4.5 bln above between 1.1620-1.1725 to help limit moves up

• EUR/JPY off after early blip up to 179.53 EBS in Asia, off since to 179.15

• Still well above 177.86 low Tuesday after profit-takes by recent JPY longs

• Below 179.43 descending 100-HMA but at top of 178.67-179.26 hourly cloud

• Cloud still descending, break above Ichimoku cloud likely in short run

• EUR/GBP more buoyant after push up to 0.8600 yesterday, NY close 0.8595

• Descending 100-DMA above at 0.8699, support from ascending 100-HMA at 0.8589

• Some option expiries today n 0.8620-30 window just above

• EUR/CHF 0.9440-45 EBS, best since 0.9447 peak on August 18, 2025

• Carry demand seen remaining strong

• Some option expiries today at 0.9400, 0.9450 today, E730 mln at 0.9500

• Related comments , , ,

• And , also , for more click on [FXBUZ]

EUR/USD:


EUR/USD nearby option expiries into next week:


EUR/CHF:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

• Shares of Jiangxi Copper drop 11.2% to HK$34.18, lowest level since July 30, leading a slide in Hong Kong-listed mining stocks as metal prices dip

• Stock last down 10%, set for biggest one-day pct decline since June 23; top pct loser in Hang Seng Composite Index on materials stocks , which is down 5.5%

• Copper prices fell on Thursday after Reuters reported White House has yet to decide on refined copper tariffs as officials assess concerns higher prices could raise manufacturing costs

• Gold prices also lingered near one-week low on Friday as expectations of a U.S. rate hike strengthened, with attention turning to U.S. CPI data later in the day

• Shares of miners MMG and CMOC Group drop 9.8% and 10.1%, respectively

• Zijin Mining and China Nonferrous Mining Corp

fall 7.3% and 7.6%

• Shanghai-listed stocks of Zijin Mining , CMOC , and Jiangxi Copper fall 6.7%, 6.9% and 9.3%

(Reporting by Donny Kwok)

• Australian gold stocks decline as much as 4% to their lowest point since August 20

• Shares of Northern Star Resources and Evolution Mining slip about 4% each

• Gold prices extend losses on Friday, a day after robust U.S. inflation data and rising oil prices increased bets for a Federal Reserve rate hike next week [GOL/]

• Gold sub-index down for a fifth consecutive session

• If losses hold, sub-index on track to log weekly loss of nearly 7%, its worst since mid-July

• Sub-index down ~2%, YTD

(Reporting by Sneha Kumar in Bengaluru)

• USD/JPY saw some bounce yesterday, spec short-coming, US PPI firm in places

• Some specs look to have booked some more profits on recent shorts

• Market still seen net short JPY however, Japan exporter offers eyed too

• Upside limited to 155.00 area, just above?

• Eyes now on US CPI out tonight, expectations for YY 3.4%, core 2.4%

• USD/JPY 154.32-61 EBS so far in Asia, 154.66 high o/n, on quiet side today?

• Spot now above 154.11 descending 100-HMA, Ichi tenkan 154.33, kijun 153.97

• Hourly Ichimoku cloud 153.45-66 and likely support for now

• Some massive option expiries in area today - 153.00 $2.9 bln, 154.00$3.1 bln

• And 154.50 $550 mln, 155.00 $1.1 bln, 155.50-75 $546 mln, 156.00-30 $1.2 bln

• JGB-US Treasury rate differentials wider, 2s towards @260, 10s @194 bps

• US CPI data tonight likely to affect US rates again, Fed expectations

• Middle East conflict re-escalation, higher crude fanning inflation fears too

• Related comments , , ,

• And , , , also

• US markets , , ,

• On US PPI/economy , , ,
USD/JPY:


USD/JPY nearby option expiries into next week:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

• Australian heavyweight miners down over 4%; mining sub-index set for weekly loss of 3.9%

• Copper prices fall after Reuters reported the White House was yet to decide on refined copper tariffs amid concerns over higher prices and manufacturing cost impact [MET/L]

• World's top miner BHP sheds as much as 4.1% to A$60.79, headed for a 2.5% weekly drop

• Rio Tinto sheds 3% to A$169.3; pure-play copper producer Sandfire Resources plunges as much as 8.3%, biggest intra-day pct loss since June 9

• YTD, AXMM up 14.5%

(Reporting by Nichiket Sunil in Bengaluru)

• AUD/USD on the defensive in Asia after closing 0.85% lower on Thursday

• Hit hard by rising Fed rate hike expectations and sticky U.S. PPI

• Markets price in a 70% probability of Fed hike on Sep 16, up from 60% Thu

• Surging global bond yields undermine AUD; U.S. 10-yr up 12 bps, nears 5%

• U.S. crude closes 6.7% higher as Middle East war escalates, risk mood sours

• U.S. Aug CPI Fri key for Fed; hotter-than-expected reading will weigh on AUD

• Support at 21-DMA at 0.7155, then 0.7117-22; resistance 0.7200-05, 0.7220

• Thursday range 0.7156-0.7223
AUD:

(Krishna Kumar is a Reuters market analyst. The views expressed are his own.)

MUFG Research discusses the UST buyback program.

"The US Treasury did not provide further updated guidance over the size of future operations. There are 6 further buybacks scheduled for the current quarter up to 3^rd November. If the US Treasury continues to hold 9 bond buybacks each quarter, and purchases up to USD6 billion at each operation then it could give a rough ballpark figure for potential annual purchases of just over USD200 billion. It would be a smaller version of the Fed’s ‘Operation Twist’," MUFG notes.

"Admittedly, it is highly uncertain how long the bigger purchases will be sustained and it is possible the size of operations could even be increased further going forward. For comparison, the Treasury’s long-term debt issuance plans for the current quarter are USD231 billion which are similar to the previous quarter," MUFG adds.

The euro dipped to a five-day low after the ECB delivered an expected 25bp rate hike and annual U.S. headline producer prices came in slightly above forecast, before trimming losses as President Christine Lagarde warned energy costs could keep inflation pressures alive.

ECB policymakers foresee more tightening ahead, potentially as early as October, two sources told Reuters.

Separately, ECB broad member and Bundesbank President Joachim Nagel said the rise of euro-skeptic parties could deter investment in Germany.

In U.S. data, producer prices increased at a monthly rate of 0.4% in August, in line with expectations, and core rose 0.2%. The annual headline rate increased at a surprisingly quick pace of 5.4%, while the previous month was revised higher.

Odds of a 25bp Fed hike next week have risen to nearly 70%, though Friday's CPI report will provide a clearer inflation picture.

WTI surged above $100/bbl on news out of the Middle East including a WSJ report that Iran restarted underground missile production in limited quantity and Iran-aligned Houthis advanced down the Red Sea coast.

EUR/USD pared an ECB- and PPI-driven slide to 1.1592, with a long-tailed candle beneath its 200-day moving average of 1.1633 and rising 21-day moving average offering bulls comfort.

GBP/USD eased after U.S. data but remains anchored near recent high by 1.3566 awaiting a slew of central bank policy decisions including the Bank of England next week.

AUD/USD remained pressured after a post-PPI slide to a six-session low of 0.7157 as metal, equity, and CNH weakness reinforced dollar buying.

USD/JPY remained biased higher as surging oil and rising Treasury yields helped to work off oversold conditions, but pair may struggle to move much beyond 155 ahead of the BOJ policy meeting next week.

Treasury yields were up 8 to 12 basis points as the curve flattened. The 2s-10s curve was down about 1 basis point to +39.2bp.

The S&P 500 slipped 0.67%.

WTI oil surged more than 6%, breaching $100/bbl.

Gold slid about 1.9% while copper dropped 5.3% amid White House indecision on tariffs.

Heading toward the close: EUR/USD -0.18%, USD/JPY +0.52%, GBP/USD -0.24%, AUD/USD -0.82%, DXY +0.25%, EUR/JPY +0.33%, GBP/JPY +0.27%, AUD/JPY -0.35%.(Editing by Burton Frierson Robert Fullem is a Reuters market analyst. The views expressed are his own)

• NY opened near 0.7200 after 0.7223 traded in Asia, slide extended in NY

• US dollar, US & global yields rallied sharply after US August PPI report

• Brent oil rally above $107.70, WTI rally above $102.55 aided those rallies

• Drops in gold, silver, copper, equities & USD/CNH gains reinforced USD buying

• AUD/USD fell to a 6-session low, neared the 21-DMA, traded down to 0.7157

• Small bounce saw 0.7170 neared late, AUD/USD was down -0.69% in NY's afternoon

• Monthly doji, falling daily RSI, drop below 10-DMA are concerns for bulls

• US August CPI in focus, an above estimate result could send AUD/USD lower
audusd

(Christopher Romano is a Reuters market analyst. The views expressed are his own)

Danske Research maintains a bearish bias on EUR/USD over the medium-term.

"The US Treasury announced that the size of the first increased long-end buyback operation conducted today will be USD6bn. This was on the lower end of expectations, as it just barely fulfils the guidance for "more than doubling" the earlier amount of USD2bn. Furthermore, the Treasury did not provide guidance for later long-end operations that are conducted roughly every 1-2 weeks. Long-end UST yields ticked modestly higher, US swap spreads tightened and EUR/USD declined, but the moves were relatively contained compared to the August announcement. Brent oil price rose back above USD100/barrel, and other energy prices remain on the rise as well. European TTF natural gas price temporarily broke through EUR80/MWh for the first time since late 2022, and electricity futures prices in Northern Europe have also risen notably in September," Danske notes.

"Overall, euro area's commodity terms-of-trade have reached their weakest level since early 2023, and over the medium-term, we see further rise in energy prices as a relatively larger downside risk to EA growth outlook (vs. the US), and a negative driver for EUR/USD," Danske adds.

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September 10 (Reuters) - Wall Street's main indexes edged lower on Thursday after producer prices data for August raised expectations of an interest rate hike this month, while an escalating conflict in the Middle East kept oil prices above $100 a barrel. [.N]

At 11:30 EDT, the Dow Jones Industrial Average was down 0.44% at 52,152.53. The S&P 500 was down 0.39% at 7,606.23, and the Nasdaq Composite was down 0.43% at 26,140.13.

The top three S&P 500 percentage gainers:

• Reddit, Inc. , up 5.5%

• Charter Communications, Inc. , up 5.2%

• Skyworks Solutions, Inc. , up 4.6%

The top three S&P 500 percentage losers:

• The Cooper Companies, Inc. , down 13.7%

• Freeport-McMoRan Inc , down 7.0%

• Baker Hughes Company , down 6.5%

The top three NYSE percentage gainers:

• Rafael Holdings Inc , up 8.7%

• Bark Inc , up 8.5%

• Designer Brands Inc. , up 8.0%

The top three NYSE percentage losers:

• Skillsoft Corp , down 29.2%

• Redwood Trust, Inc. , down 18.9%

• Biohaven Ltd. , down 14.5%

The top three Nasdaq percentage gainers:

• Tenon Medical Inc , up 76.6%

• Digital Brands Group Inc , up 50.9%

• Professional Diversity Network Inc , up 36.3%

The top three Nasdaq percentage losers:

• CDT Equity Inc , down 42.3%

• Megan Holdings Ltd , down 34.2%

• MKDWELL Tech Inc , down 34.1%

• Meta Platforms Inc : BUZZ - J.P.Morgan turns bullish on Meta's AI monetization potential

• American Eagle Outfitters Inc : BUZZ - Falls on margin pressure, sluggish apparel demand

• AeroVironment Inc : BUZZ - Rises as first-quarter results beat estimates

• Cooper Companies Inc : BUZZ - Drops on revised annual profit forecast

• Navan Inc : BUZZ - Tumbles on cost concerns, overshadowing strong quarter

• Centrus Energy Corp : BUZZ - Falls on $500 mln stock-and-warrants offering

• Shoe Station Group Inc : BUZZ - Tumbles after cutting annual profit, sales forecasts

• Macy's Inc : BUZZ - Falls as downbeat quarterly outlook clouds annual forecast boost

• Axogen Inc : BUZZ - Drops after equity raise for $200 mln BioCircuit acquisition

• Lovesac Co : BUZZ - Slides after annual forecasts below estimates

• Hagerty Inc : BUZZ - Slides after upsized $110.5 mln secondary offering

• Biohaven Ltd : BUZZ - Drops as US FDA seeks more BHV-7000 safety data

• Simmons First National Corp : BUZZ - Rises after KBW upgrades stock

• Designer Brands Inc : BUZZ - Up after raising annual forecasts

• Rio Tinto PLC :

• BHP Group Ltd :

• Southern Copper Corp :

• Free port-McMoRan Inc : BUZZ - Copper miners fall on White House hesitancy over tariff plan

• Tenable Holdings Inc : BUZZ - Tumbles after unveiling $650 mln convertible

• Kinetik Holdings Inc : BUZZ - Rises after report says pipeline operator exploring sale

• Redwood Trust Inc : BUZZ - Plunges on planned convertible debt deal

• TTM Technologies Inc : BUZZ - Falls after unveiling debt package to fund Epiq, STG acquisitions

• BKV Corp : BUZZ - Drops on boosted $500 mln convertible bond sale

• Elevance Health Inc : BUZZ - Rises after positive Q3 comments

Index RIC Index name Percent

change %

S&P 500 -0.4

S&P 500 Information Technology -0.66

S&P 500 Utilities -0.54

S&P 500 Consumer Discretionary -0.12

S&P 500 Materials -1.48

S&P 500 Industrials -0.46

S&P 500 Communication Services 0.03

(Sector)

S&P 500 Financials -0.18

S&P 500 Real Estate -0.34

S&P 500 Health Care -0.38

S&P 500 Consumer Staples 0.44

S&P 500 Energy -0.47

(Compiled by Rajarshi Roy and Miraanta Lowrance in Bengaluru)

Goldman Sachs Research previews the US August CPI report due on Friday.

"We expect a 0.23% increase in August core CPI (vs. +0.2% consensus), corresponding to a year-over-year rate of +2.40% (vs. +2.4% consensus). We expect a 0.39% increase in headline CPI (vs. +0.4% consensus), reflecting higher energy prices. Our forecast is consistent with a similar 0.22% increase in core PCE in August," GS notes.

"Looking beyond August, we expect monthly core CPI increases of around 0.2% for the next couple of months, reflecting the continued slowdown in the shelter categories and shrinking contributions from tariff-related price increases, though risks are tilted to the upside if disruptions to oil markets and associated oil price increases prove more persistent than expected," GS adds.

• EUR/GBP nudges up to 0.8598 following ECB rate rise to 2.5%

• 0.8598 is one-week peak (0.8607 was two-month high on Sept 3)

• Pre-ECB hike high was 0.8592 (Wednesday high was 0.8595)

• 30-year gilt yield rises to its highest level since 1998

• UK July GDP data due on Friday at 0600 GMT; zero growth forecast

• BoE is expected to keep its policy rate at 3.75% next week, by 6-3 vote

EURGBP

(Robert Howard is a Reuters market analyst. The views expressed are his own)

Bank of America Global Research discusses the UST outlook in light of Treasury buyback program.

"Treasury's buyback announcement yesterday was met with some disappointment, driving back-end rates 5bps higher and long-end spreads ended marginally cheaper...The announcement followed Treasury's surprise Aug 19 guidance that it would "at least" double long-end buyback operations for the quarter. Treasury set a max purchase amount of $6b for today's buyback operation and indicated purchase sizes of "= or >$4 billion" for the remaining five long-end buyback operations this quarter," BofA notes.

"We expect Treasury to purchase close to the $6bn max today; buying materially less would risk further back-end cheapening. If Treasury cannot contain the selloff in back-end rates, it may consider more impactful debt-management measures. We continue to recommend clients buy the dip on 30y spreads due to a more activist US Treasury," BofA adds.

 Societe Generale Research discusses the fair-value estimates for USD/JPY.

"The correlations between rate differentials and EUR/JPY simply had the wrong sign. What we know is that the Big Mac Index suggests that [we] could buy a burger in Tokyo for less than half the price we would have to pay in London, and the OECD PPP measure puts fair value for USD/JPY below 100. We are nowhere near fair value but, since the catalyst for these massive mispricings was the explosion in rate differentials after 2020, the fair value that the 2020-2024 correlation between rates and USD/JPY would imply today is 135," SocGen notes.

In order to get USD/JPY down, Japan needs higher rates, but to sustain higher rates, Japan needs brighter growth prospects and, to get those, it surely needs lower oil prices. As a result, we remain sceptical about how far an intervention-led yen rally, even one supported by the US, can go in the absence of stronger Japanese GDP growth to provide credibility for Japan's higher bond yields," SocGen adds.

• AUD/USD rallied to 0.7223 overnight, sellers emerged and the pair turned lower

• US yields extended gains which helped underpin USD buying

• Drops in gold, silver and copper reinforce the USD buying theme

• AUD/USD hit 0.7200 just ahead of NY's open, it was down -0.24% early NY

• Falling daily RSI, today's drop following Wednesday's doji are concerns for bulls

• Rising monthly RSI, pair's hold above the 10- & 21-DMAs gives bulls some comfort

• US August PPI & weekly jobless claims are data risks in NY's morning
audusd

(Christopher Romano is a Reuters market analyst. The views expressed are his own)

FX option markets have been focused on USD/JPY 150.00 since the initial drop from the mid 159's last week, but price action in this derivative suggests the biggest and most volatile moves may now be over and any deeper declines toward 150.00 will be harder fought.

Implied volatility is the market's gauge of actual/realised volatility risks, so it's been no surprise to see it surge higher across the 1- to 12-month expiry term structure beside the FX spot price drop. The benchmark 1-month expiry actually exceeded the late July intervention-led high at 10.65, spiking from 7.15 to an eventual 11.6 peak - a very significant increase. However, since USD/JPY's consolidation in the last 24 hours, 1-month expiry implied volatility has dropped back to 10.0, with other expiry dates easing beside it as longs book profits and others take advantage of the high premiums to benefit from short volatility strategies.

USD/JPY risk reversal options saw their JPY call over put (downside over upside) strike premiums ramped significantly higher as spot fell and downside options were sought - the benchmark 1-month expiry 25 delta contract from an already elevated 1.75 to 2.75 vol premium - but it's since dropped back to 2.15.

The demand for 150.00 JPY call strikes throughout the recent moves has rewarded holders from the lower spot and higher implied volatility as their value increased dramatically, but profits are now being booked there and demand has eased off. It's also worth noting the demand for JPY call reverse-knock-out (RKO) options - they remain sought due to being significantly cheaper than regular JPY call vanilla options, but the attached triggers are below 150.00, to suggest this level is a likely near-term floor.

Attention now turns to Friday's US CPI data, where FX options are demanding an elevated volatility risk premium given its potential to shape next week's Fed decision—itself already flagged as a heightened risk event by elevated implied vol pricing. The Bank of Japan's own policy announcement follows close behind on September 18, with markets largely expecting a 25-bp hike; the bigger uncertainty lies in the press conference, where clues on the pace and extent of further hikes could still move the pair. That layered event risk—CPI, Fed, then BOJ within days of each other—is keeping demand firm for options expiring just beyond each date. USD/JPY, in short, isn't out of the woods yet.
USD/JPY FXO implied volatility


USD/JPY 25 delta risk reversals

(Richard Pace is a Reuters market analyst. The views expressed are his own)

(Adds link to todays large expiries on line 4)

• EUR/USD FX option implied volatility sits close to recent lows - benchmark 1-month expiry 5.0

• Risk reversal contracts lack directional risk premium - 1-month skew neutral, easing from prior downside

• Trade flows show little conviction for EUR/USD to trade far in either direction

• More big FX option strike expiries and related hedging still helping to contain FX price action

• However, there is plenty of short term volatility risk premium in prices - flagging near term event risks

• Overnight options jumped since including Friday's US CPI, having almost ignored today's ECB and US PPI

• 1-week expiry implied volatility has risen sharply now that it captures the September 16 Fed decision

• Price action suggests the Fed could the much needed catalyst for any EUR/USD movement
EUR/USD FXO implied volatility


EUR/USD 25 delta risk reversals

(Richard Pace is a Reuters market analyst. The views expressed are his own)

• Yen trading near seven-month highs

• USD/JPY has seen 153.29-74 range, on Thursday, EBS data shows

• There was some Japanese importer demand at Thursday's Gotobi Tokyo fix, exporter sales also

• A weekly close by USD/JPY below a broken 154.78 Fibo would be a bearish sign

• 154.78 Fibo, a 38.2% retrace of the 139.89 to 163.99 (April to July) EBS rise

• USD/JPY and EUR/JPY tend to move in tandem, log correlations are high above +0.5

Daily Chart


Weekly Chart


Correlation Chart

(Martin Miller is a Reuters market analyst. The views expressed are his own)

• AUD/USD has traded a 14.9 pip range thus far Thursday; 0.72081-0.7223

• 0.72081 is also the low since Wednesday's four-month high of 0.7238

• US PPI data due at 1230 GMT; 0.4% MM, 5.3% YY. Core f/c 0.3% MM, 4.6% YY

• Hotter prints could spur hawkish shift in Fed expectations, inflate USD

• Reuters poll: 28 out of 93 economists expect Fed hike on Sept 16

• JPMorgan expects RBA to raise rates on Sept 29, as does Goldman Sachs

AUDUSD

(Robert Howard is a Reuters market analyst. The views expressed are his own)

• ECB seen raising key rate to 2.50%

• Expected to signal readiness to tighten further

• Oil's rise in lead up to meeting heightens risk hawkish outlook

• Futures imply a further 25bps hike very likely this year (Oct/Dec)

• EUR/USD which reached 1.1654 Weds trades 1.1630-41 on Thursday

• EUR/USD is yet to close above the 200-DMA at 1.1634

•
EURUSD

(Jeremy Boulton is a Reuters market analyst. The views expressed are his own)