Yen hits new low after Bank of Japan keeps policy rate unchanged
The Bank of Japan has decided to keep its benchmark policy rate unchanged at 0%-0.1%, according to a recent announcement. This decision was in line with market expectations and has resulted in a significant drop in the value of the Japanese yen. The yen has now weakened beyond 156 against the U.S. dollar, reaching fresh 34-year lows.
The impact of this decision is also reflected in the stock market, with the benchmark Nikkei 225 index extending gains and rising by 0.7%. This positive performance shows the market’s confidence in the Bank of Japan’s monetary policy direction.
Investors are now eagerly awaiting a press conference by BOJ Governor Kazuo Ueda later in the day, where more insights into the central bank’s decision and future plans may be revealed.
Hon Hai shares jump 4% to highest level in over two weeks
Shares of Taiwan’s Hon Hai Precision Industry have surged as much as 4.3% in early trading, reaching their highest level in over two weeks. This significant jump in stock price is attributed to U.S. software company Cerence’s recent announcement that it will supply Hon Hai’s EV subsidiary, Foxtron, with a voice-powered AI assistant.
The collaboration between Foxtron and Cerence brings a first-of-its-kind intuitive voice interaction system to Taiwanese drivers. The AI assistant features bilingual recognition of Taiwanese Mandarin and English, providing a unique and personalized driving experience.
This positive development has had a substantial impact on Hon Hai’s shares, which have already surged nearly 50% so far this year. The partnership with Cerence further solidifies Hon Hai’s position in the electric vehicle market and positions the company for continued growth.
Tokyo inflation slows sharply in April, core inflation sharply lower than expected
The latest inflation figures from Japan’s capital city, Tokyo, indicate a significant slowdown in April. Inflation slowed to 1.8% from the previous month’s gain of 2.6%. Core inflation, which excludes the prices of fresh food, also experienced a sharp decline, coming in at 1.6%, down from 2.4% in March.
These figures not only missed economists’ expectations of 2.2% but also serve as a leading indicator for nationwide trends. The sharp decrease in inflation could have wider implications for the Japanese economy, highlighting potential challenges in stimulating growth and controlling inflation.
Fed’s preferred inflation gauge for March will be out Friday
This Friday, the Federal Reserve will release its latest update on the personal consumption expenditures (PCE) price index for March. This metric is considered the Fed’s preferred measure of inflation and provides valuable insights into the current state of the economy.
Economists polled by Dow Jones anticipate headline PCE to have grown by 0.3% from the prior month and 2.6% from the previous year. Core prices, which exclude food and energy costs, are expected to have grown by 0.3% on a monthly basis and 2.7% year over year.
This update comes after the release of the first-quarter gross domestic product report, which showed a significant increase in PCE. The strong performance has raised concerns among investors, as signs of stagflation – characterized by slowing economic growth and rising inflation – emerge. Market participants will closely analyze the upcoming PCE data to gain a better understanding of the current inflationary pressures.
After hours movers
Several companies experienced significant movements in after-hours trading following key announcements:
- Snap: Shares soared more than 27% after the social media firm reported first-quarter results that beat analysts’ estimates.
- Intel: The tech stock slid 8% after missing expectations for first-quarter sales and providing a weak forecast for the current quarter.
- Dexcom: The manufacturer of glucose monitoring systems fell 8% despite posting beats on the top and bottom lines.
- Gilead Sciences: The biotech stock jumped almost 3% after surpassing analyst expectations in its quarterly report.
These after-hours movements highlight the market’s reaction to company performance and provide valuable insights for investors. It is essential to closely monitor such developments to make informed investment decisions.