- USD/JPY falls to a fresh low as official sees a "high sense of urgency"
- Australia is closed today for Australia Day but AUD hits the highest in 15 months
- Gold blasts through $5000 to all time high. What to look for next
- Chinese President Xi Jinping launched the largest military purge in years
- Japan PM Takaichi Sunday yen verbal intervention. Follows USD/JPY Friday rate check slam.
Markets:
- Gold up $89 to $5071
- Silver up 4.6% to $107.70
- WTI crude up 12-cents to $61.19
- S&P 500 futures down 20 points
- Japan 10-year yields down 1.4 bps
- JPY leads, USD lags
It was a dramatic start to the trading week as USD/JPY fell nearly 200 pips and broke through 154.00. Note that the pair was above 159 on Friday before the dramatic reversal on various reports/rumors of a rate check. That was followed up today and on the weekend by more signs of verbal intervention as Takaichi ahead of the Feb 8 election.
What further weighed on the US dollar was that the odds of a US government shutdown rose after a tragic weekend in Minnesota. That's something of a wild card but it underscores the divisions in US politics that are certainly adding some angst. A big beneficiary of that is the precious metals complex as gold broke through $5000 for the first time and promptly added nearly $100 more. Silver also cruised through $100 to as high as $109.77 before some minor profit taking.
Adding to the sense of unease was a major military purge by China's Xi on the weekend, including the top uniformed military official and a member of the Politburo. So far that hasn't hit Chinese stock markets but it's a sign of a tumultuous world.
Australian was on holiday but that didn't stop AUD/USD from rising to a fresh 15 month high.
US equity futures opened sharply lower but halved the decline in fairly short order and are now trading down just 0.3%. Eyes will be on a heavy slate of earnings this week.
