investingLive Asia-Pacific FX news wrap: Bessent boosts yen, AUD jumps on accelerating CPI

• Goldman Sachs expects a 25bp rate cut from the Bank of England in November
• US Treasury/BoT says FX intervention is to fight excess volatility, disorderly movements
• BofA sees BoJ hiking rates in January after hawkish October hold
• Japan Chief Cabinet Secretary Kihara says has no comment on Bessent’s remarks
• Coming up – Fed expected to cut rates by 25 bps, Powell seen offering limited guidance
• Trump says expects to lower fentanyl linked tariffs on China
• Toyota executive Ueda: Japanese govmt positive view on reverse imports from US
• PBOC sets USD/ CNY central rate at 7.0843 (vs. estimate at 7.0962)
• South Korea’s President Lee says protectionism and nationalism are rising
• Australian dollar jumped after very strong CPI data, November RBA rate cut off the table
• Australian Q3 Core inflation (trimmed mean) +1.0% q/q (expected 0.8%, RBA forecast 0.6%)
• Yen surging after comments from US Treasury Secretary Bessent
• Bessent says Japan government gives Bank of Japan policy space, avoid excess FX volatility
• Ray Dalio calls gold “the most fundamental money,” urges 5–15% portfolio allocation
• SoftBank and Hitachi among investors in $550 billion U.S. plan
• Trump signals he’s ready to put US military boots on the ground in US cities
• Trump’s Brazil tariffs are under threat – some of his party in Congress vote against
• RBNZ official says interest rates falling, credit conditions becoming more favourable
• ICYMI: Trump’s Truth Social launches crypto prediction market Truth Predict
• North Korea fired missiles says the country’s official news agency,
• It’s a holiday in China today but markets are open. However, Hong Kong is ‘hold my beer!’
• Oil – private survey of inventory shows a headline crude oil draw larger than expected
• The Tuesday UK inflation data still reverberating through markets – BoE rate cut prospects
• More record closes as investors look forward to Fed, China/US truce and AI enthusiasm
• investingLive Americas market news wrap: Fresh stock market records once again, NVDA soars

The yen saw brief volatility after U.S. Treasury Secretary Bessent posted on X praising Japan’s commitment to Bank of Japan independence and “policy space,” calling it vital for anchoring inflation expectations and avoiding excess FX volatility.

Bessent also said he was encouraged by the Finance Minister’s grasp of how Abenomics had evolved from a purely reflationary approach toward one balancing growth with inflation risks. The remarks prompted a knee-jerk yen rally, with USD/JPY sliding to session lows just below 151.80 before rebounding to trade little changed around 152.00 as I post.

The Australian dollar also moved. Q3 CPI accelerated sharply, with headline inflation up 3.2% y/y (from 2.1% in Q2) and 1.3% q/q, the fastest quarterly pace since March 2023, driven mainly by higher electricity costs.

The core measure, trimmed mean, CPI rose 1.0% q/q (vs 0.8% expected) and 3.0% y/y (from 2.7%). The outcome was well above the RBA’s forecast of +0.6% q/q for core inflation. Governor Bullock said earlier this week that a 0.9% quarterly rise would represent a “material miss.” With inflation overshooting even that, a November rate cut is now off the table, and expectations for a December cut have evaporated.

AUD/USD jumped initially but gains were capped, given the currency’s earlier in the week strength following Bullock’s hawkish remarks.

Across broader FX, the U.S. dollar firmed modestly against the euro and pound. Asia-Pacific equities mostly traded higher, extending Wall Street’s tech-driven rally to fresh records. Market focus now turns to the FOMC decision and upcoming mega-cap earnings later in the week.

Asia-Pac
stocks:

• Japan
  (Nikkei 225) +2.07%
• Hong
  Kong (Hang Seng) % … Hong
  Kong markets were closed for a holiday
• Shanghai
  Composite +0.41%
• Australia
  (S&P/ASX 200) -0.93%

This article was written by Eamonn Sheridan at investinglive.com.