Yen plummets to lowest point in nearly four decades

We're watching the yen very closely. 16031 is the current level, but it did weaken to its lowest level since 1986. That'd be 160.38. Joining us now is Peter Bokvar, Bleakley Advisory Group CIO and CNBC contributor. Peter, great to have you with us. The BOG will meet next week, next month, I should say, and at the end of July. They've got to be hawkish. What do you think happens? I, I think they're laying the groundwork for not only a rate increase of maybe 1015 basis points, not as much as 25, and also trimming back on their QE, still doing QE, but doing less of it. There's an extraordinary amount of pressure now on the Bank of Japan from not only the the Japanese citizenry from that is dealing with higher inflation and now a decrease in the purchasing power of the yen, but also the Ministry of Finance that doesn't want to have to deal with FX intervention because they know that usually fails. The question though, is, is that even after those moves, is that going to be enough to stem this yen weakness? Because there's still a mile wide between U.S. policy rates and what will be in Japan. One month is a long time to watch this currency slide. Peter, do you think they try and step in? I mean, traders are are it's it's been sort of the whisper for the past month or so that the BOJ would eventually have to step in. Or do you think that this slide is orderly enough that the BOJ would not? Well, they've done it twice already over the past couple of months and the impact was maybe a couple of days. And we're seeing now obviously the retails with 160 proving that those two times have failed. The only way to get a sustainable slowdown, at least in the depreciation of the end, or at least or maybe even get a rally, is actual action by the BOJ. So I'm not sure if they were going to intervene before that BOJ meeting and sort of front run it, but maybe in order to give any yen rally triggered by that meeting some momentum, maybe they intervene after that meeting, but in the meantime, having to wait for a further weakness. Oh, interesting. The flip side literally to this whole yen weakness is a strength in the US dollar, Peter, And and the strength in the US dollar is being seen, you know, across crosses, so against every major currency in the world. And so how do you think that manifests during earnings season, which is literally right around the corner? Are we going to hear more commentary? Is it going to be more of a a quote, UN quote thing during the season? Well, it will be for some. For some. I mean many multinationals try to hedge, but it's impossible to really fully do that. In the last couple of quarters, we did see by Coca-Cola and Microsoft and some of the big names that do business everywhere that a few 100 basis points of revenue growth was clipped by the rally and the dollar. So you could see a repeat of that. But I think overall, the dollar strength isn't enough to really move the needle earnings wise. I mean, even take the euro for example, it's been trading seemingly in a 105 to 115 range for years now and it remains in that range. And I think the dollar overall is in a long term trading range outside of the outliers like the yen. All right, Peter, got to let you go. Thanks so much for your thoughts this morning. Peter Bokvar obliquely.