Morning Brief: Japan and US conduct coordinated yen intervention; Trump holds off new strikes on Iran; Amazon earnings bolster AI profitability outlook

Core Snapshot

💴 Japan and the United States launch coordinated foreign exchange intervention to prop up the yen. Trump voices support for stabilising the yen. USD/JPY falls 1.22% to 157.57. The US Dollar Index slides 1.64% weekly, marking its steepest weekly drop since late January.

🕊️ Trump intends to delay new military strikes against Iran to seek an accelerated agreement. OPEC+ approves a supply increase of roughly 188,000 barrels per day starting September.

📈 Amazon’s quarterly results validate improving returns on AI investments. Major US equity indexes closed higher amid volatility, with the Nasdaq rising 1.59% for the week.

I. Market Outlook

Key Events:

- Coordinated Japan-US yen intervention: Japan’s Ministry of Finance announces joint yen-buying intervention alongside the US. Trump pledges assistance to support the yen.

→ USD/JPY drops 1.22% to 157.57. The Dollar Index falls 0.19% to 99.812, posting a 1.64% weekly decline, the sharpest since late January.

- Trump delays new strikes on Iran: Trump says he will suspend fresh military assaults if a rapid deal can limit Iran’s nuclear programme and reopen shipping lanes in the Strait of Hormuz. Iran warns it will retaliate firmly against any attack.

→ WTI crude rises 1.29% to $84.67/bbl, down 5.19% for the week. Brent crude climbs 1.22% to $90.12/bbl, with a 23.53% monthly gain in July.

Exclusive Insight:

The yen gained over 1% in a single session following rare G7 coordinated intervention. The diplomatic signal carries greater weight than the scale of intervention. Trump’s public backing shows exchange rates have become part of US-Japan diplomatic agenda. Crude edged higher despite de-escalation rhetoric and OPEC+ supply hikes, as investors remain cautious over shipping security in the Strait of Hormuz.

II. Overnight Market Action

— US Stocks: Nasdaq rose 1.00% to 25373.85; Dow Jones climbed 0.53% to 52485.03. S&P 500 gained 1.05% weekly, Nasdaq advanced 1.59% weekly.

— European Stocks: STOXX Europe 600 fell 0.1% to 649.19. DAX rose 0.07%, CAC 40 added 0.28%, FTSE 100 slipped 0.27%.

— Bond Market: 10-year US Treasury yield jumped 8.2 bps, the largest single-day rise since May 15, and posted a second consecutive weekly gain.

— Commodities: September WTI crude +1.29% at $84.67/bbl, weekly loss 5.19%. Brent crude +1.22% at $90.12/bbl, up 23.53% in July. Spot gold -1.27% to $4051.30/oz, monthly gain 0.53%. Silver -1.89% to $57.8705/oz.

— FX Market: USD/JPY -1.22% at 157.57. Dollar Index -0.19% at 99.812, weekly drop 1.64%. EUR/USD flat at 1.1527. GBP/USD +0.12% at 1.3480.

— Crypto Assets: Bitcoin hovers near $63,000; Ethereum trades at $1863.57.

III. Macro News

1. 💴 Japan and US launch coordinated intervention to lift yen

Japan’s Ministry of Finance announced joint yen-buying intervention with the United States. Trump stated he would assist in supporting the yen. Japanese authorities noted they will not hesitate to conduct further coordinated intervention when needed.

Insight: Coordinated intervention among G7 nations is uncommon. The signaling effect outweighs actual capital deployment. Washington’s tolerance for yen depreciation is nearing limits. The lasting impact of intervention hinges on US-Japan interest rate differentials.

2. 🕊️ Trump delays strikes on Iran to pursue rapid negotiations

Trump offers to suspend new military attacks if a swift agreement curbs Iran’s nuclear ambitions and reopens the Strait of Hormuz. Iran threatens forceful retaliation against any military strike.

Insight: Attacks are postponed rather than cancelled. The negotiation window remains narrow. Iran’s tough stance suggests tough negotiations, making it hard to fully erase geopolitical risk premiums in oil prices.

3. 🏛️ Three Fed hawks advocate immediate rate hikes

The three policymakers who voted for higher rates at the latest FOMC meeting warned inflation could stay above the 2% target without immediate policy tightening.

Insight: Open divisions emerge within the Federal Reserve. The pause led by Wash faces internal pushback. Persistent oil prices above $90 will amplify hawkish rhetoric ahead of the September meeting.

4. 🛢️ OPEC+ approves 188,000 bpd supply increase starting September

The move marks the full unwinding of voluntary production cuts, which had been widely priced in by markets.

Insight: The moderate supply hike limits bearish pressure on crude. OPEC+ seeks balance between demand growth and price stability. Shipping conditions in the Strait of Hormuz remain the dominant short-term driver for oil prices.

IV. Global Corporate News

1. 🤖 OpenAI confirms new Astra model, solves 10 unsolved mathematical problems with $2,000 computing cost

Successful verification would represent a major leap in AI reasoning capacity, expanding research boundaries and spurring fresh demand for computing power. Findings are presented to regulators to support upcoming AI regulatory frameworks.

2. ☁️ Amazon holds a 5% stake in OpenAI alongside existing investment in Anthropic

Amazon expands its AI portfolio, covering both OpenAI and Anthropic to build integrated cloud and AI model layout. Its $50 billion investment plan has been fully deployed.

3. 💾 South Korea memory chip survey: Samsung long-term contracts set price floors without upper limits. Spot prices are set to rebound before Q4 peak season

Samsung’s pricing structure shields long-term clients from downside risks yet prevents locking low prices during rallies. Memory chips viewed as strategic AI assets are reshaping traditional cyclical pricing rules.

V. Key Events to Watch

📊 July Manufacturing PMI from US, China, Japan, South Korea, Eurozone and UK. Global manufacturing data will show whether lower oil prices and easing geopolitical tensions improve industrial outlook.