The JPY is trading near a one-month low against the USD as traders await the BoJ's policy decision. The Fed's recent rate cut and hawkish stance are supporting the USD and limiting the JPY's downside.
The Japanese Yen (JPY) is consolidating its recent losses against the US Dollar ( USD ), reaching a one-month low. Traders are hesitant to make new bets and are waiting for the Bank of Japan (BoJ) decision before taking any action. The USD is maintaining its gains after the Federal Open Market Committee (FOMC) meeting and is acting as a supporting factor for the USD /JPY pair. The JPY will be in focus this Thursday as the BoJ is set to announce its final policy decision for the year.
While a rate hike is not expected, the BoJ might hint at a potential increase in January. This possibility is preventing JPY bears from making further downward bets. Additionally, the global risk-off sentiment, reflected in the decline of equity markets, is providing some support to the safe-haven JPY, limiting the overnight USD/JPY rally to near its one-month peak. The Fed's hawkish stance and recent interest rate cut have pushed long-term US Treasury yields to a multi-month high, which should also cap the lower-yielding JPY. The post-FOMC USD surge to a two-year high is expected to further limit the downside for the USD/JPY pair. However, the crucial BoJ policy decision could lead to market volatility, and any hawkish signals might trigger another JPY carry trade unwinding, putting downward pressure on the currency pair. The Fed lowered its benchmark policy rate by 25 basis points on Wednesday to the 4.25%-4.50% range, marking the third such cut since September. The so-called dot plot indicates that policymakers now foresee only two quarter-point rate cuts next year, compared to the four anticipated in September. Fed Chair Jerome Powell stated in his post-meeting press conference that inflation remains elevated compared to the central bank's 2% longer-run goal
Japanese Yen USD Boj Federal Reserve Interest Rates
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
USD/JPY: Fed and/or BoJ’s pace slowdown may affect USD/JPY’s movesUSD/JPY eased lower this morning after PPI came in higher than expected.
Read more »
USD/JPY: Fed and BoJ Decisions to Ignite FX Market VolatilityForex Analysis by David Scutt covering: US Dollar Japanese Yen, US Dollar Index Futures, United States 2-Year, United States 10-Year. Read David Scutt's latest article on Investing.com
Read more »
BoJ Policy Decision and USD/JPY OutlookAnalysis of the upcoming BoJ Monetary Policy Committee (MPC) decision and its potential impact on the USD/JPY exchange rate. The text considers factors such as recent JPY decline, BoJ's policy normalization stance, and the influence of Fed policy and US data.
Read more »
USD/JPY hits two-week highs near 153.50 as BoJ tightening hopes fadeThe US Dollar is trading higher on Friday, approaching the 153.50 area supported by the widening gap between US and Japanese Treasury yields, as hopes of a BoJ hike next week fade.
Read more »
USD/JPY outlook: Cracks pivotal 150 support zone on growing expectation for BoJ rate hikeUSDJPY fell to six-week low on Friday, in fresh acceleration lower after stronger than expected inflation rise in Tokyo in November, boosted expectations for Bank of Japan’s rate hike in the policy meeting next month.
Read more »
Fed and/or BoJ’s pace of policy normalisation to affect USD/JPYUSD/JPY rose sharply, in response to news that BoJ officials see little cost to waiting before raising rates.
Read more »