- USD/JPY has extended its losses after slipping to near 143.00 as DXY has weakened further.
- The DXY has dropped below 109.50 as investors have already discounted the rate hike by the Fed.
- Japan’s National CPI and core CPI have landed at 3.0% and 1.6% respectively.
The USD/JPY pair has extended its correction after surrendering the immediate hurdle of 143.15. The decline is purely parallel to the subdued performance of the US dollar index (DXY). A mixed National CPI has failed to strengthen the yen bulls. The headline National CPI has landed at 3%, higher than the forecasts and the prior release of 2.6%. Also, the core CPI that excludes food and oil prices has improved to 1.6% that the former figure of 1.2% but remained lower than the expectations of 1.7%.
On a broader note, the asset is oscillating in a range of 142.55-143.80 after declining from around 145.00.
The asset is expected to display a lackluster performance as investors are awaiting the interest rate decision by the Federal Reserve (Fed). In order to regard its foremost priority of cooling the red-hot inflation, the Fed will advance towards the path of hiking interest rates. Investors should not be surprised with a rate hike of more than 75 basis points (bps) as price pressures are not responding effectively to the current pace of accelerating borrowing rates.
Meanwhile, the DXY declined on Monday after failing to sustain above the psychological resistance of 110.00. The DXY witnessed a steep fall as investors started discounting the expectations of a subpar rate hike.
On the Tokyo front, the Bank of Japan (BOJ)’s recent plan of intervening in the Fx moves is hinting at a shift in monetary policy stance. A worried economy due to currency depreciation from a tad longer period will prefer to shift its stance from an ultra-dovish to neutral. Well, the economic situation is not supporting a stance shift but caring for domestic currency is a major concern now.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD trims some gains, recedes to 1.1350
Despite losing some upside momentium, EUR/USD keeps the firm tone around the mid-1.1300s on Thursday, buoyed by renewed US Dollar weakness as investors grappled with the continued stalemate in US–China trade negotiations.
GBP/USD puts the 1.3300 level to the test
GBP/USD hovers around the 1.3300 area on Thursday, supported by a broad rebound in risk-sensitive assets, renewed weakness in the Greenback and lingering uncertainty over US–China trade talks.
Gold sticks to the bullish stance near $3,330
On Thursday, gold regained lost ground after two consecutive days of declines, with XAU/USD climbing back toward $3,300 per troy ounce following an earlier rally to roughly $3,370. The metal drew safe-haven buying as renewed fears of a US–China trade flare-up weighed on broader markets.
Bitcoin Price corrects as increased profit-taking offsets positive market sentiment
Bitcoin (BTC) is facing a slight correction, trading around $92,000 at the time of writing on Thursday after rallying 8.55% so far this week. Institutional demand remained strong as US spot Exchange Traded Funds (ETFs) recorded an inflow of $916.91 million on Wednesday.
Five fundamentals for the week: Traders confront the trade war, important surveys, key Fed speech Premium
Will the US strike a trade deal with Japan? That would be positive progress. However, recent developments are not that positive, and there's only one certainty: headlines will dominate markets. Fresh US economic data is also of interest.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.