The dollar index <=USD> ended little changed. The yuan <CNH=> ticked a bit higher against the dollar <CNH=> which meshed with news that China’s state owned banks were active in forex markets last week trying to contain the yuan’s slide, according to four people with direct knowledge.
On Sunday, a China foreign ministry spokesperson said China will sanction five U.S. military manufacturers in response to the latest round of U.S. arms sales to Taiwan. The sanctions come a week before Taiwan’s Jan. 13 presidential and parliamentary elections, which China has cast as a choice between war and peace.
Dollar/yen <JPY=> ended Friday up a fractional 0.02%, just enough to extend the 2024 winning streak to four days.
Bank of Japan Governor Kazuo Ueda faces pressure to end Japan’s negative interest rate policy. Last week’s devastating earthquake could make it harder to rev up the economy and inflation.
On Monday Japan’s December household spending and Tokyo Consumer Price Index could feed into Nikkei and JGB trading.
Several other CPI reports are due this week, including the Australia CPI on Tuesday, China CPI Thursday, India CPI on Friday and the widely anticipated U.S. release on Thursday.
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