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USD/JPY jumping on this. Inflation undershooting estimates and also the prior month’s readings.

Tokyo CPI +2.9% y/y

• expected 3.2%, prior +3.4%

CPI excl fresh food +2.2%

• expected 2.3%, prior 2.5%

CPI excl food and energy +1.9%

• expected +2.0%, prior +1.9%

USD/JPY marked higher, the reasoning being it takes off some pressure for nearer-term BoJ rate hikes:

This article was written by Eamonn Sheridan at www.forexlive.com.

Greg had the oil market headlines here:

• OPEC + is hesitant on going ahead with plans April oil output hike
• OPEC+ hesitant
• Russia, UAE would like to proceed
• Saudi Arabia favor a delay

​The next ​
OPEC Joint Ministerial Monitoring Committee (JMMC), which oversees compliance with OPEC+ agreements, will convene on April 5, 2025.

​The next full OPEC+ meeting is scheduled for May 28, 2025.

This article was written by Eamonn Sheridan at www.forexlive.com.

Various reports of this about, from Japanese and other media. In summary:

A leading Japanese labour union group representing major manufacturers has called for an unprecedented increase in base salaries this year, driven by mounting living costs and last year’s strong wage momentum.

The Japan Council of Metalworkers’ Unions (JCM), which plays a key role in shaping annual wage negotiations, represents approximately 2 million employees at major corporations such as Toyota Motor, Panasonic, and Nippon Steel.

According to the JCM, its members have so far requested an average monthly base salary increase of 14,149 yen—the highest figure recorded since the group began tracking comparable data in 2014. This marks a 14% increase from the average base pay hike sought at the same point last year.

The findings are based on responses from nearly half of JCM’s 3,050 member unions that have already submitted their wage demands.

Securing higher base salaries is seen as essential for Japan’s broader objective of achieving sustainable wage growth that surpasses core inflation, which remains above 3%. Unlike standard annual pay increases linked to seniority, base pay rises directly impact long-term wage structures.

Meanwhile, Japan’s largest labour organisation, Rengo, of which JCM is a key affiliate, is pushing for an overall wage increase of at least 5% in 2025, including a minimum 3% rise in base salaries..

—

The case for nearer term Bank of Japan rate hikes continues to build.

This article was written by Eamonn Sheridan at www.forexlive.com.

Data from New Zealand, ANZ-Roy Morgan Consumer Confidence

It rose a little, to 96.6 in February

• prior 96 even

ANZ:

• proportion of households thinking it’s a good time to buy a major household item, the best retail indicator, lifted 1 point to -15
• inflation expectations were little changed at 4.0%, continuing their stable run

I’m posting the data for those keeping track. Its not moving the NZD. As I’ve said a number of times recently, the kiwi$, along with other FX, is being moved much more by international developments than local data. By international developments I mean Trump’s on-off-on-off-etc. (i.e. inconsistent) rambling on tariffs.

The war on markets continued today:

• Forexlive Americas FX news wrap: Fresh Trump tariff threat submarines markets

This article was written by Eamonn Sheridan at www.forexlive.com.

If you are all done trashing stocks, here is what’s on the data agenda here during the Asian session for Friday, February 28, 2025.

Tokyo CPI is the focus, I’ve a bit of an explainer on how this differs from the national CPI below the screenshot. The full national February data will be published in around three weeks. You’ll note the core rate, ie that for CPI excluding fresh food, is expected to have subsided a little from January, but remain above the Bank of Japan’s 2% target. While note shown in the screenshot expectations I have seen for the headline centre on 3.2%.

• This snapshot from the ForexLive economic data calendar, access it here.
• The times in the left-most column are GMT.
• The numbers in the right-most column are the ‘prior’ (previous month/quarter as the case may be) result. The number in the column next to that, where there is a number, is the consensus median expected.

As background to the Tokyo area inflation data:

• National-level CPI data for this month will follow in about three weeks, it takes longer to gather and collate the national data.
• Tokyo CPI is a sub-index of the national CPI
• It measures the change in prices of goods and services in the Tokyo metropolitan area
• Its considered a leading indicator of national CPI trends because Tokyo is the largest city in Japan and is a major economic hub
• Historically, Tokyo CPI data has been just slightly higher than national Japan CPI data. The cost of living in Tokyo is a touch higher than in most other parts of Japan. Higher rents, for example

This article was written by Eamonn Sheridan at www.forexlive.com.

Good morning, afternoon and evening all. Any charts, technical analysis, trade ideas, thoughts, views, ForexLive traders would like to share and discuss with fellow ForexLive traders, please do so:

This article was written by Eamonn Sheridan at www.forexlive.com.

US Treasury Secretary Bessent:

• Open to the idea that other countries’ tariffs could come down or go away.
• Ukraine critical minerals deal is done, there is no more negotiation on that.
• Ukraine deal covers critical minerals, oil and gas, and infrastructure assets.
• Ukraine deal shows the American people that we have not squandered their money.

This article was written by Eamonn Sheridan at www.forexlive.com.

North Korea has test fired a strategic cruise missile to test nuclear deterrence

Back in the day this headline would have prompted a move into yen and the USD. Not so much any more.

Besides, the USD is already up on the tariff talk that keeps on flowing out of Trump’s mouth:

• Forexlive Americas FX news wrap: Fresh Trump tariff threat submarines markets

This article was written by Eamonn Sheridan at www.forexlive.com.

• Trump pledges an additional 10% tariff next week. Says Canada/Mexico tariffs still on
• White House confirms additional 10% on China for a 20% total
• US initial jobless claims 242K versus 221K estimate
• US January durable goods orders +3.1% vs +2.0% expected
• US Q4 GDP second reading +2.3% vs +2.3% expected
• Trump: Tariffs are are going to make our country rich
• Trump says Russia acting well and that a peace deal is “well advanced”
• There haven’t been intensive discussions around avoiding China tariffs – report
• OPEC + is hesitant on going ahead with plans April oil output hike
• KC Fed manufacturing index -5 vs -9 prior
• BOJ’s Ueda: Will make decisions on mon pol after scrutinizing US policy
• US January pending home sales index hits an all-time low
• Fed’s Harker: Policy remains restrictive enough to keep downward pressure on inflation
• Fed’s Hammack: Fed likely to hold rates steady ‘for some time’
• Fed’s Schmid: Concern growing about recent increase in inflation expectations
• WH Adviser Hassett: There’s a study coming out on tariffs on April 1st

Markets:

• Gold down $44 to $2872
• WTI crude oil up $1.53 to $70.15
• US 10-year yields up 2.8 bps to 4.28%
• S&P 500 down 1.6%, Nasdaq down 2.8%
• USD leads, AUD lags

It all came undone in the US session today. The mood was fair coming into US trade with S&P 500 futures +35 points but there were signs of trouble as Nvidia shares had given up an overnight gain following earnings. Then it all fell apart when Trump revealed a new 10% tariff on China slated for next week and reaffirmed the plan to hit Canada/Mexico after yesterday seemingly pushing it back by a month.

The market reaction was slow at first as it wasn’t clear if Trump meant a new 10% tariff on China or the one from the start of the month. In addition, the softer initial jobless claims number raised fresh questions about economic strength.

The moves started as a trickle but eventually became a flood, including an 8.5% drop in shares of Nvidia.

AUD was the laggard in FX in a sign that the fresh China tariffs were a big factor in the market price action. AUD/USD started US trading near 0.6300 and initially fell to 0.6250 and held steady there until a late-day crunch in risk assets and a fall to 0.6235.

It was similar across the board as the US dollar broadly strengthened. The exception was the yen, which largely tracked the USD move. An early tell may have been a counter-intuitive reaction to the US data slate with initial jobless claims. The higher number should have weighed on the dollar but it initially rose it what looked like a flow-driven move.

Some of the USD strength may have been on higher PCE inflation numbers in the GDP report. That could flow into revisions in tomorrow’s January report that could boost the y/y readings. That number will be closely followed but it will be tough for it to overshadow tariff talk and AI volatility. On the latter, every Mag7 stock was down at least 1.8% on Thursday.

This article was written by Adam Button at www.forexlive.com.

• We are going to have a deal done with UK on trade rather quickly
• Tariffs are not about inflation but about fairness

It’s been impressive how the UK has managed to avoid any threats from Trump.

This article was written by Adam Button at www.forexlive.com.

The S&P 500 opened at 5864 on the morning after the US election, it’s now trading at 5880.

That’s just a few points higher on what was a surprisingly strong Republican sweep. In the aftermath of the election, the market was enthralled with the idea of extending the Trump tax cuts, deregulation and a pickup in economic growth.

Instead, it’s been tariffs, chaotic foreign policy and layoffs.

I think ultimately, the pro-growth agenda wins out but I’m not sure the market wants to buy into that until we see the tax cut passed. At the same time, DeepSeek has upended the AI theme and Nvidia isn’t the bedrock it once was.

Most of the post-election trades have now reversed , including Tesla, which is also back to where it was on the morning after the election. DOGE is looking like a short-term gain for Elon but long-term pain.

This article was written by Adam Button at www.forexlive.com.

OpenAI is hosting a livestream of the release of ChatGPT 4.5 right now.

It’s going to be rolled out for Pro users this week and Plus users next week. Deep Research has earned some rave reviews.

At the same time, today feels like a telling day. Nvidia beat on earnings, rose after hours and is now down 6.3%. If a new model from OpenAI and great results from Nvidia can’t boost the market, then what can?

There was a time when good news from OpenAI and NVDA on the same day would have the market up 3%.

The company is also talking about GPT 5 and says this model will be its last “non-chain-of-thought model”.

This article was written by Adam Button at www.forexlive.com.