Overview

• U.S. Treasury Secretary Yellen’s comment that the Fed’s policy rate “should be at a lower level” broadened expectations for an earlier U.S. rate cut and spurred yen buying
• The dollar slid to the low-¥146 range on August 14, its strongest level in three weeks, before returning to the high-¥147s after fresh data and currency flows
• July wholesale prices in the U.S. rose more than forecast, raising inflation concerns even as markets largely maintained bets on a September Fed rate reduction
• Japan’s Cabinet Office reported Q2 real GDP growth of 0.3% quarter-on-quarter (annualized 1.0%), marking a fifth consecutive quarter of expansion
• Tokyo’s Nikkei index fell ¥625 on August 14 amid profit-taking following a seven-day rally, then rebounded by roughly ¥279 on August 15 as investors digested the mixed signals