Market Digest: Dollar Steady Against Yuan, Yen Wobbles as Rate Risks Loom

Dollar Stability and Chinese Economic Policies

The dollar remained stable against the yuan amidst China’s policy statements lacking substantial stimulus measures. Analysts noted the challenges ahead for China’s economic growth target of 5%, citing factors like the property crisis and geopolitical tensions.

• Crypto mania continues, with bitcoin trading near $66,000.
• Beijing sticks to ambitious growth target of 5% and budget deficit of 3%.
• Analysts express concerns over slow recovery and low investment confidence in China.

Japanese Yen’s Reaction to Tokyo Inflation Data

The Japanese yen held steady after Tokyo core inflation accelerated to 2.5% in February, signaling progress towards the end of negative interest rates. Expectations of the Bank of Japan hiking rates into positive territory next month are rising.

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• Tokyo core inflation exceeds expectations at 2.5% in February.
• Bank of Japan likely to move from negative rates to zero in April.
• Positive wage hikes could boost consumer spending in Japan.

Fed Chair Powell’s Testimony and Euro Dynamics

The Federal Reserve’s potential rate cuts in June and the European Central Bank’s upcoming meeting are under scrutiny. Market sentiments and central bank actions play a crucial role in shaping currency movements.

• Fed Chair Jerome Powell to update investors on rate cut outlook.
• European Central Bank expected to maintain rates; potential cuts in June.
• Euro and sterling movements influenced by central bank decisions and market dynamics.