Watching the dollar firm up against both $EURUSD (1.14202) and $USDJPY (161.67). Seems to be a persistent theme. This move in $USDJPY is getting quite extended. Will be interesting to see if this reflects broader risk-off sentiment or just yield differentials.
Good point on the risk-off versus yield differentials. I'm leaning more towards the latter, given how aggressively the Fed has been. It's making the dollar very attractive.
It's not just the majors, even some of the more exotic pairs are showing significant dollar strength. This feels like more than just a short-term blip to me.
While USDJPY is high, the carry trade is still very much in play. As long as rate differentials remain wide, it's hard to bet against the dollar here.
Definitely seeing that USD strength too. The EURUSD move has been quite steady, but that USDJPY is indeed getting stretched. Wondering if we'll see any intervention soon.