- USD/JPY moves higher above 158.00 amid firm US Dollar.
- The US Dollar remains firm as the Fed restricts a number of rate cuts this year to one.
- The Japanese Yen remains vulnerable as the BoJ postponed plans of reduction in bond-buying operations.
The USD/JPY pair jumps above 158.00 in Tuesday’s European session. The asset strengthens as the US Dollar (USD) recovers strongly after a modest correction. The US Dollar exhibits a strong performance as Federal Reserve (Fed) policymakers continue to reiterate their projection for only one rate cut this year.
On Monday, Philadelphia Fed Bank President Patrick Harker said he sees one cut in benchmark rates this year if his economic forecast plays out, Reuters reported.
On the contrary, financial markets expect that the Fed will deliver two rate cuts by the year-end. Market speculation for rate cuts twice this year strengthened after the Consumer Price Index (CPI) report for May showed that inflation cooled down at a faster pace. This also increased confidence among investors that the progress in the disinflation process has resumed.
Fed policymakers also acknowledged the soft inflation as encouraging. However, officials said that they want to see inflation declining for months before announcing rate cuts.
Meanwhile, investors shift focus to the United States (US) Retail Sales data for May, which will be published at 12:30 GMT. The US Census Bureau is expected to report an increase in the Retail Sales by 0.3% after remaining flat in April.
On the Tokyo front, the Japanese Yen continues to face selling pressure as the Bank of Japan (BoJ) has pushed plans for reducing bond-buying operations to the July meeting. This has deepened fears of limited scope for policy tightening.
This week, investors will focus on Japan’s National Consumer Price Index (CPI) data for May. Annual National CPI excluding Fresh Food is expected to have accelerated to 2.6% from the prior reading of 2.2%.
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
US Nonfarm Payrolls crushed consensus in March – LIVE
The US economy added 228K jobs in March, exceeding the initial estimate of 135K. In addition, the print came in higher than February’s 117K gain (revised from 151K). Meanwhile, the unemployment ticked higher to 4.2 (from 4.1%).
EUR/USD keeps daily gains around 1.1070 on NFP
The US Dollar’s inconclusive price action remains in place on Friday as the latest data reveals the US economy added more jobs in March than previously estimated, with EUR/USD hovering around daily highs near 1.1070.
Gold remains on the back foot around $3,000 after US Payrolls
In the wake of March’s US labour market report, Gold prices maintain their offered tone around the critical $3,000 mark per troy ounce amid marginal gains in the Greenback and further weakness in US yields.
Can Maker break $1,450 hurdle as whales launch buying spree?
Maker holds steadily above $1,250 support as a whale scoops $1.21 million worth of MKR. Addresses with a 100k to 1 million MKR balance now account for 24.27% of Maker’s total supply. Maker battles a bear flag pattern as bulls gather for an epic weekend move.
Strategic implications of “Liberation Day”
Liberation Day in the United States came with extremely protectionist and inward-looking tariff policy aimed at just about all U.S. trading partners. In this report, we outline some of the more strategic implications of Liberation Day and developments we will be paying close attention to going forward.
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.