Japan’s services producer price index rose 3.2% year-on-year in June, driven by a surge in freight costs. Ocean freight costs surged 61.8% year-on-year as of May, and the Iran conflict, which began in late February, has disrupted critical global shipping routes, roughly doubling Asia-to-US container rates. The broader producer price index hit 7.1% in June, the highest reading since March 2023, fueling speculation about additional Bank of Japan rate hikes. Such monetary tightening would strengthen the yen and force an unwind of the yen carry trade, creating selling pressure across risk assets including crypto. In August 2024, Bitcoin dropped roughly 15% during a similar carry trade unwind.
Source: Read the original article
