The Japanese Yen (JPY) is making headlines with its daily gains despite the likelihood of the Bank of Japan (BoJ) raising rates in 2024. Japan’s parliament is gearing up for a special session to discuss the BoJ’s recent interest rate hike, with Governor Kazuo Ueda expected to provide insights. Meanwhile, geopolitical tensions in the Middle East are contributing to safe-haven flows, supporting the Yen.
On the other hand, the US Dollar is holding steady as Treasury yields rise, following disappointing Producer Price Index (PPI) data that have reduced expectations for a significant Fed rate cut in September. All eyes are now on the US Consumer Price Index (CPI) report for further clues on the Fed’s future rate cut decisions.
Daily Digest Market Movers: Japanese Yen Strengthens on BoJ Expectations
- Japanese Prime Minister Fumio Kishida’s announcement not to seek re-election highlights the focus on combating Japan’s deflation and boosting economic growth.
- Rabobank’s FX strategist Jane Foley predicts a 25 basis points rate cut by the Fed in September, with potential further cuts by year-end.
- The latest US PPI data shows a lower-than-expected increase, signaling challenges for the Fed’s rate cut plans.
- Atlanta Fed President Raphael Bostic and Federal Reserve Governor Michelle Bowman offer insights into inflation and rate cut decisions ahead.
- The Bank of Japan’s outlook on economic activity and inflation, along with concerns over import prices, adds to the market sentiment.
Technical Analysis: USD/JPY Trends and Support Levels
USD/JPY is hovering around 146.80, below the nine-day EMA, indicating a bearish trend. The RSI at the 30 level suggests a potential correction, with support levels at 141.69 and 140.25. Resistance lies at the nine-day EMA at 147.45, with a breakout expected to test the 50-day EMA at 153.40.
USD/JPY: Daily Chart
Japanese Yen PRICE Today
The Japanese Yen has shown weakness against the Swiss Franc today, with percentage changes against major currencies reflecting the market sentiment.
Economic Indicator: Producer Price Index ex Food & Energy (YoY)
The Producer Price Index ex Food & Energy released by the Bureau of Labor Statistics measures price changes in primary markets, excluding volatile products like food and energy. The data influences USD strength, with high readings seen as positive and low readings as negative.
Now, it’s crucial for investors to monitor the developments in the Japanese Yen, BoJ decisions, and Fed rate cut expectations to make informed decisions in the financial markets.