Japanese Yen loses ground as Fed tightening bets boost US Dollar
USD/JPY extends its rebound on Tuesday and trades around 155.00 at the time of writing, up 0.41% on the day. The pair continues its recovery from levels below 153.00 reached last week, mainly supported by broad-based strength in the US Dollar (USD).
The Japanese Yen experienced a decrease as investors anticipated monetary policy decisions from the Federal Reserve (Fed) and the Bank of Japan (BoJ). The US Dollar gained strength due to robust economic data released in the US, leading markets to price in a 92% chance of a rate hike by the Fed on Wednesday. This, combined with the Bank of Japan's potential 25 basis points rate increase on Friday, created volatility in the USD/JPY exchange rate.
While the BoJ hike is expected and priced in, market participants are uncertain about the BoJ's tone and future hike guidance. Technical analysis suggests that USD/JPY will face resistance at the 155 level, with key support around 153. Additionally, rising oil prices are negatively impacting the Japanese Yen as it hampers the country's energy-dependent economy.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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