Ella 
Recent signs that the U.S. is pricing in “adjustment rate cuts” if the economy does not enter a recession have led to a weaker dollar. This is consistent with expectations that the dollar’s strength will gradually and unevenly weaken as economies around the world face less pressure from economic challenges. However, a key factor in the outlook for a stronger dollar is the continued confidence in the U.S. economy compared with other regions. The latest data showed that the euro zone’s fight against inflation is accelerating, coupled with sluggish economic activity in France and Germany and the possibility of fiscal tightening in Germany. The European Central Bank may cut interest rates before the Fed in response to economic growth approaching recession, rather than just an “adjustment” rate cut. This situation does not bode well for a strong euro
In the case of the Japanese yen, traders found themselves unpredicting risk position adjustments and ignoring signals suggesting policy changes from the Bank of Japan (BoJ). The situation changed when Bank of Japan Governor Kazuo Ueda communicated with Japanese Prime Minister Fumio Kishida. As a result, we observe widespread investor support for the yen, driven by the large amount of Japanese institutional funds waiting to be deployed. This development resulted in a major market event in the past 24 hours, resulting in a 4-digit bounce in the Japanese Yen.
