Powell unexpectedly released an eagle last Friday, which analysts believe is a confirmation of the upward trend in US bond yields. In the new week, there are still doubts about these two major currencies in the foreign exchange market, and investors are preparing for new fluctuations

After US and European policymakers hinted at the annual meeting held in Jackson Hole that interest rates may remain high for a longer period of time, traders are preparing for a cautious start to the week.

Although the Australian dollar and Japanese yen have hardly changed since the opening of the Asian session, the Japanese yen is hovering around its lowest level this year. Australian bonds opened light, and investors also digested China's latest measures to support its stock market.

Last Friday, Federal Reserve Chairman Powell stated that the United States may raise interest rates again, thereby pushing up short-term US bond yields. Powell, speaking at the Kansas City Federal Reserve Bank's annual seminar in Jackson Hole, Wyoming, stated that the Federal Reserve is "prepared to further raise interest rates in appropriate circumstances", although he emphasized that monetary policy will continue to be influenced by economic data.

Meanwhile, European Central Bank President Lagarde has vowed to keep borrowing costs at the necessary high levels until inflation returns to the target level.

After Powell's speech, US bond prices fell, pushing the policy sensitive two-year US bond yield up to 5.09%, while the actual yield of five-year US bonds soared to its highest level since 2008. The yen has fallen to a year low of 147 against the US dollar, once again raising questions about whether Japan will intervene to support the yen.

Citigroup analysts Andrew Hollenhurst and Veronica Clark wrote after Powell's speech, "Powell clearly and intentionally reiterated the macroeconomic reasons for hawkish bias in Federal Reserve policy making, which largely confirms the trend of higher US bond yields over the past two months.

The dialogue surrounding the Federal Reserve stands in stark contrast to the Bank of Japan. The Japanese authorities have hinted that they are closely monitoring the trend of the yen.

Bank of Japan Governor Kazuo Shibata did not comment on the exchange rate issue during his speech in Jackson Hole last Saturday, but he stated that the rate of price growth is still below the central bank's target, which explains why officials continue to implement current monetary policy.

A foreign media indicator shows that since the beginning of this month, the exchange rate of Asian currencies against the US dollar has fallen by 2%. We are more likely to see larger scale intervention in the renminbi and some verbal intervention in the yen, "said Ed Al Hussainy, global interest rate strategist at Columbia Threadneedle Investments.

The Fed's tough stance may also exacerbate the pain in the region's stock markets, with the Morgan Stanley Capital International Asia Pacific Index likely to record its largest monthly decline in nearly a year.

According to data compiled by foreign media, as of August, global funds have withdrawn approximately $5.9 billion from emerging market stocks in Asia, including China.

Toshiya Matsunami, a strategist at Nissay Asset Management in Tokyo, said that in Asia, "if the yield of US treasury bond bonds rises to 4.5%, high-tech stocks will be vulnerable". The benchmark 10-year US treasury bond bond currently yields about 4.25%. Companies related to personal computers and smartphone chips will be in a difficult situation.

Risk reminder and exemption clause: There are risks in the market, and investment needs to be cautious. This article does not constitute personal investment advice, nor does it take into account the specific investment goals, financial situation, or needs of individual users. Users should consider whether any opinions, viewpoints, or conclusions in this article are in line with their specific situation. Invest accordingly and take responsibility