USDJPY strength is accumulating orders currently as we await the coming news this week. The forex market had previously made its trade end slightly lower on Friday and has resumed with a tight trading consolidation session after the opening of this new week. Because the World Bank has stated that higher interest rates are more likely to cause a global recession, market traders have been encouraged to purchase the Japanese Yen. Earlier in the week, there was a hike in rates by the Federal Reserve as the US consumer inflation data shot up. However, the US Treasury yield eventually went lower after so many wild spikes at different intervals. This affected the pressure as the downside was seen on the USDJPY.
USDJPY Is Still Oscillating Near the 143.000 Key Level as Attention Shifts to the Fed’s Announcement
The US dollar has been seen to attract new bids amidst the Asian session and has made progress in drawing more strength from the anticipation of more policy tightening by the Fed. The Bank of Japan, on its own, has been slowly behind when it comes to normalisation of the policy compared to other major central banks. This is a noteworthy departure from other major central banks’ more hawkish stances, which continue to support the Japanese yen and the USD/JPY pair while also supporting other major currencies.
The currency pairs continue to consolidate amidst speculation that the BoJ will help reduce further free fall. Market investors are still holding back from placing new orders as they prefer to stay aside ahead of key central bank events as the new week unfolds. The Fed is prepared to announce its policy decision after its two meetings on Wednesday, and the major focus will be on the next update for economic projections. This will eventually help investors look for fresh clues across the board. The policy-making decision will therefore play a key role in specifying the near-term course for the USDJPY currency pair.
Note: Forexschoolonline.com is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results.