AUD/JPY tumbles below 92.40 as ex-Japanese Prime Minister Shinzo Abe shot in Nara

• AUD/JPY has turned volatile and has recorded an intraday low of 92.35 after ex-Japan PM Abe shot in Nara.
• Ex-Japanese Prime Minister Shinzo Abe has been shot during his speech at a rally in Nara.
• This week’s hawkish RBA policy strengthened the aussie bulls against the Japanese yen.

The AUD/JPY pair has slipped strongly to near 92.35 after the headlines from Japan that ex-Japanese Prime Minister Shinzo Abe shot during his speech at a rally in Nara. At the time of writing, the headlines describing his condition were that he is unconscious. This has dragged the risk barometer firmly after a decent upside move from the critical support of 91.50 recorded on Wednesday.

The aussie bulls were performing better than the Japanese yen on the announcement of a jumbo rate hike by the Reserve Bank of Australia (RBA). The RBA announced a consecutive rate hike by 50 basis points (bps) this week. RBA Governor Philip Lowe has elevated the Official Cash Rate (OCR) to 1.35%. It is worth noting that the decision remained in line with the estimates by the market participants. No doubt, the price pressures are soaring in the Australian economy. The inflation rate has reached 5.1% and the room for more inflation is still there as oil and food products have turned volatile further.

On the Tokyo front, the wide divergence between the plain-vanilla Consumer Price Index (CPI) and core CPI has affected the Japanese economy. A higher core CPI indicates that the overall demand is majorly driven by food products and fossil fuels. This may keep restricting the Bank of Japan (BOJ)  with its ultra-loose monetary policy.