USDJPY remains around the high of 154.78 set on Tuesday.
During the early European session on Wednesday, USDJPY traded around 154.60, close to its peak of 154.78. Which had not been seen since June 1990.
The US dollar increases on predictions that the Fed would keep higher interest rates in place for an extended period of time.
The decline in the US Dollar (USD) puts pressure on the USDJPY pair. However, forecasts that the Federal Reserve (Fed) would keep interest rates elevated for a longer duration. Buoyed by a solid US economy and persistent inflation, counterbalance the downward
Trend of the USDJPY currency pair. Federal Reserve Chair Jerome Powell’s comments at the Washington Forum on Tuesday may have boosted the dollar. Powell stated that new data show minimal progress on inflation this year, implying a longer period before reaching the 2% objective. According to Reuters, this statement may have led to a more hawkish tone and boosted the US dollar.
Japan’s Merchandise Trade Balance Total increased to a surplus of ¥366.5 billion in March, up from a deficit of ¥377.8 billion.
On the other hand, the Japanese Yen (JPY) may have found support in the country’s trade balance. Which shifted to surplus in March. The Merchandise Trade Balance Total increased to ¥366.5 billion from the previous deficit of ¥377.8 billion. Furthermore, a private study found that morale among Japanese firms weakened in April as a weaker Yen drove up import costs.
Furthermore, the Japanese yen may benefit from safe-haven inflows. Which are anticipated to be driven by risk aversion. Investors are closely watching Israel’s response to Iran’s air strike on Saturday. According to Reuters, Israel’s war cabinet’s third meeting, originally set for Tuesday, has been pushed back to Wednesday to discuss a response to Iran’s unprecedented direct attack.
On Friday, the Statistics Bureau of Japan will release Japan’s National Consumer Price Index (CPI) data. Which traders eagerly await. Market estimates suggest that consumer prices will moderate in March.
