Yen climbs on tariff talk, Fed does little....>

FOREX: Yen climbs on tariff talk, Fed does little to roil markets

-After initially slipping in the early Asia session, US traders were happy to

bid up the JPY against all others as US Treasury yields briefly climbed back

above the 3% mark. The looming threat of a 25% tariff (prev. 10%) on $200bln

worth of USA-bound Chinese goods helped sour sentiment with eyes turning to a

government announcement at 1930GMT. USD/JPY bears look for a close below the

Y110.63 50-dma to confirm another leg lower.

-The USD barely blinked following the Fed's minimally revised statement. Rates

were kept unchanged, leaving markets eyeing September as the next opportunity to

hike rates. DXY remains in a holding pattern above trendline that's held since

June.

-AUD, NZD underperformed from the off, taking the CNH's leg lower as a cue on

tariff concerns. Both remain well within 2% of the year's lows against the USD.

-Attention turns to Thursday's BoE rate decision, where markets eye a 25bps rate

hike and the publication of r*, the Bank's estimated equilibrium real interest

rate.