- The U.S. Dollar (USD) advanced 0.5% against the Japanese Yen (JPY), reaching 148.65 on Wednesday, July 17, 2025. This move sees the USD/JPY pair retesting its May high, reflecting the ongoing strength of the greenback.
- The appreciation of the dollar is primarily attributed to the significant interest rate differentials between the United States and Japan. The Federal Reserve (FED) maintains its policy rates within the 4.25%-4.50% range, while the Bank of Japan (BOJ) recently raised its short-term policy rate to 0.5% from 0.25% in January, marking its highest level in 17 years.
- Despite the Bank of Japan's move towards policy normalization, the yield gap continues to favor the dollar, driving funds into higher-yield currencies. Market focus is now shifting to upcoming U.S. Consumer Price Index (CPI) data, which could further influence the pair's trajectory.
- In the commodities market, Malaysia, the world's second-largest palm oil exporter, has set its August crude palm oil (CPO) reference price at 3,864.12 Ringgit (MYR) per tonne. This new reference price has triggered a higher 9.0% export duty rate for the month. [Headline]
- This August duty rate marks an increase from July's 8.5% export duty, which was based on a lower reference price of RM3,730.48 per metric tonne. The export tax structure for crude palm oil in Malaysia ranges from 3% to a maximum of 10% when prices exceed RM4,050 per tonne.
- The higher reference price and duty come as Malaysian palm oil futures have seen a rebound. On July 16, 2025, the benchmark CPO contract for October delivery on the Malaysian Derivatives Exchange rose by RM45 per tonne, or approximately 1.08%, reaching RM4,208 per metric ton. This upward trend has been supported by rising soybean oil prices on the Chicago Exchange, stronger global crude oil prices, and a weakening Ringgit, which enhances the competitiveness of Malaysian CPO exports in the international market.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. We are not financial professionals. The authors and/or site operators may hold positions in the companies or assets mentioned. Always do your own research before making financial decisions.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.