As the spotlight switches to US inflation, the USDJPY is persistently fluctuating below 140.00.
In the European session. The USDJPY pair is consistently trading in a narrow range. Below the critical resistance of 140.00. The asset is exhibiting erratic movements as investors remain cautious. Ahead of the release of US inflation data.
In London, S&P500 futures have made big gains. As investors hope that the Federal Reserve (Fed) would refrain from raising interest rates. This time but will leave the door open for future increases. In July, interest rates will be raised. Market is extremely favorable, reducing the appeal of the US Dollar.
The US Dollar Index (DXY) has reached a new two-week low of 103.21 as the probability of the Fed pursuing a neutral interest rate policy remain exceedingly strong. More decline in the USD Index appears likely. As it faces pressure from the risk-aversion theme and forecasts for additional US inflation weakening.
We predicted that the headline CPI would remain flat during the month, since petrol prices declined and food prices appeared to remain stable. Core inflation, on the other hand, is likely to have remained stable. According to auction data, used vehicle prices increased again last month. We seek continued strength in core services. In particular, we believe the core CPI grew 0.4% for the third month in a row, leaving the YoY change at 5.3% in May.
BoJ Ueda is expected to maintain the current interest rate, policy while underlining the need for more monetary policy.
The Bank of Japan’s (BoJ) interest rate announcement will be closely monitor in terms of the Japanese Yen. Furthermore Governor Kazuo Ueda of the Bank of Japan is expected to maintain the current interest rate policy, citing the need for additional monetary policy to keep inflation consistently above 2%. The central bank is trying to increase wages and overall demand.
