The primary development in the foreign exchange market today is a notable recovery of the yen, following what are being interpreted as hawkish comments by Bank of Japan Governor Kazuo Ueda. Elsewhere, markets have generally adopted a consolidative tone.
Gold briefly reached a record high, trading just above $2,990 before pulling back. Oil remains firm, although the gap created by Monday’s lower opening in the December WTI contract, which extended to around $71.80, has yet to close.

Asia-Pacific Markets
It was an active session in the Asia-Pacific region. The Bank of Japan, as expected, held policy steady, with only minor adjustments to its macroeconomic forecasts. Governor Ueda’s remarks highlighted the economic impact of foreign exchange rates, which many took as an indicator of possible rate hikes. This view prompted a short squeeze, helping the yen to regain ground. In response, the dollar briefly dipped below JPY 152, its lowest since Monday.
The Australian dollar also saw an “outside day,” trading on both sides of Tuesday’s range, but closed within that range, limiting its technical significance. It continues to trade below $0.6600.

European Markets
In the eurozone, a slight uptick in inflation was reported. Consumer prices rose by 0.3% in October, pushing the annual rate to 2.0% (up from 1.7% in September). Among the bloc’s largest economies, three countries kept their EU-harmonized inflation rates below 2%.
The euro reached a new high yesterday, slightly above $1.0870, before consolidating in a narrow range around $1.0855.
Meanwhile, the UK budget release saw sterling trade within a range of over one cent but ultimately closed within Tuesday’s range, with disappointment lingering due to sterling’s failure to maintain a position above $1.30, where it remains below today.

American Markets
In the U.S., September’s personal income and consumption data, already incorporated in yesterday’s Q3 GDP release, showed the economy grew at 2.8%, slightly under projections. However, consumer spending grew robustly to 3.7% from the prior quarter’s 2.8%. Investors are looking ahead to tomorrow’s monthly employment report, following a sharp rise in ADP private sector employment (233k), driven largely by seasonal adjustments, marking the highest increase since July’s 307k.
Canada will also release its August GDP figures later today.