Daily Alert – Friday 26th April 2024: The Yen is sinking fast

Mark NugentApril 2024, Daily Alert

Daily Alert – Friday 26th April 2024: The Yen is sinking fast

Good afternoon.

Yesterday saw US GDP (annualised) missing to the downside. The reading for Q1 was 1.6% against an expectation of 2.5%. A surge in imports contributed a drag to the GDP number, but the US economy is definitely slowing.

Today’s US inflation number, the Fed’s chosen measure, PCE, beat expectation to the upside at 2.8% vs 2.6%. This, combined with the slowing economy, makes US interest rate cuts seem some way off.

The Bank of Japan kept interest rates at 0.0%, as expected. What did disappoint the markets was the absence of tough talk on the weak JPY. This sent the JPY yet lower against the USD. It’s not looking good for the Yen as the US growth and inflation situation will only strengthen the USD and exacerbate Yen weakness. I think a Bank of Japan intervention to strengthen the Yen is a case of when, not if.

My S&P500 long trade failed to really take off. I got out for a gain of just over 1.2%.

Over at big tech, earnings season was bad for Tesla (low sales), and Meta (low sales, higher spend) and good for those battling it out on the AI stage, Microsoft and Google, both of whom beat revenue and earnings forecasts in this incredibly fast-moving sector.

That’s it from me. Have a great weekend. I will be back on Monday.

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