French Prime Minister Vile announced plans to call for a vote of confidence in his cabinet on September 8, with many in the opposition expressing no confidence and the imminent collapse of his government.
This led to a sell-off of French government bonds and French stocks, and the Eurodollar fell about 100 points.

But will political uncertainty in one French country lead to a sell-off in the euro as a whole?
The euro may be vulnerable to a sell-off right now, but the story of Europe as a whole expanding fiscal spending and turning to aggressive fiscal policy cannot be easily changed.
It may be possible to view the fallout from the French political situation as a buying opportunity for the euro.

The biggest focus of attention was the speech by Chairman Powell at Jackson Hole, where he softly hinted at a “rate cut” and, barring any particular obstacles, a U.S. interest rate cut at the September FOMC meeting was almost a done deal.
At last year’s Jackson Hole meeting, Chairman Powell also declared in high spirits that “the time has come” to shift monetary policy in an accommodative direction. Since then, the Fed has cut policy rates by a total of 1% three times, but the current level of the dollar/yen is not much different from that time.
The story of the yen appreciating due to a narrowing interest rate differential is easy to draw, but it will not last.

The currency markets are gradually becoming more and more gridlocked. The fact that the yen has not easily returned to a strong position even though we know that the U.S. monetary policy will be easing in the near future suggests that we are missing something big.
In July, the yen plunged sharply, but the same thing could happen. But is it because of the poor fundamentals of the yen that a temporary plunge does not last?
As long as there is no change in the fundamental weakness of the Japanese economy, expectations of a correction in the yen’s depreciation toward purchasing power parity may be difficult to realize.

Although NVIDIA’s financial results were better than market expectations, the strong results were factored in beforehand, and the stock price was pushed down about 3% on profit-taking selling.
Normally, the dollar-yen exchange rate would weaken as risk turns on the yen, but today the yen has been strengthening, testing 147.00 yen at one point. This is due to the fact that the Trump administration is mounting a full-scale attack on the Fed.
At first, it appeared to be just a whim of President Trump, but the independence of the central bank, which has been built up over many years, is now in jeopardy. The market may be beginning to seriously consider this risk.

Will the dollar test the downside?