Japanese Yen ticks up from session lows after the release of mixed US data

USD/JPY eases below 158.00 following US data releases but remains on track for a 0.7% weekly rally.
US GDP Growth beat forecasts in Q3, but Personal Income and Spending declined.
Markets are bracing for a hawkish hold at Friday's BoJ meeting.

Guillermo Alcala FXStreet

The Japanese Yen (JPY) has trimmed some losses against the US Dollar (USD) on Thursday as softer-than-expected Personal Income and Spending data offset the enthusiasm about the bright Gross Domestic Product (GDP) reading. The USD/JPY pair has retreated to the 157.90 area from session highs just above 158.00, although it remains on track for a 0.7% weekly appreciation.

Data from the US Bureau of Economic Analysis revealed that US economic growth accelerated to a 3.4% annualised rate in the third quarter, up from the 2.2% growth in the previous quarter and beating expectations of a 3.2% increase.

Personal Income and Spending decline beyond expectations

Preliminary US Personal Consumption Expenditures (PCE) accelerated to a 3.6% year-on-year pace in September, from 3.4% in August. Personal Income, on the other hand, eased to 0.2% growth against expectations of a steady 0.3% increase, and Personal Spending growth fell to 0.5% from 0.9% in the previous month. These figures hint at softer inflationary pressures from consumer demand and endorse Fed Chairman Kevin Warsh's faith in the bank's monetary policy.

On Wednesday, Federal Reserve (Fed) left rates unchanged, as widely expected, with Warsh’s comments to the press considered tilted to the dovish side. Warsh showed confidence that the “monetary medicine is starting to work, and affirmed that the bank might achieve the 2% inflation target without having to “throw people out of work”

Warsh's comments were seen as a sign that the bank might not have to hike rates as much as the market expects in 2027 and triggered a moderate US Dollar pullback.

The focus now will shift to the Bank of Japan (BoJ), which will release its monetary policy decision during Friday’s Asian session. The BoJ is expected to keep interest rates on hold and hint at a further rate hike in December. Anything different than that would be disruptive. A rate hike is out of the question, and casting any doubt about the unwritten law of quarterly rate-hiking is likely to send the Yen tumbling.

Economic Indicator

Gross Domestic Product Annualized

The real Gross Domestic Product (GDP) Annualized, released quarterly by the US Bureau of Economic Analysis, measures the value of the final goods and services produced in the United States in a given period of time. Changes in GDP are the most popular indicator of the nation’s overall economic health. The data is expressed at an annualized rate, which means that the rate has been adjusted to reflect the amount GDP would have changed over a year’s time, had it continued to grow at that specific rate. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish.

Why it matters to traders?

The US Bureau of Economic Analysis (BEA) releases the Gross Domestic Product (GDP) growth on an annualized basis for each quarter. After publishing the first estimate, the BEA revises the data two more times, with the third release representing the final reading. Usually, the first estimate is the main market mover and a positive surprise is seen as a USD-positive development while a disappointing print is likely to weigh on the greenback. Market participants usually dismiss the second and third releases as they are generally not significant enough to meaningfully alter the growth picture.

Economic Indicator

Personal Spending

Personal spending, released by Bureau of Economic Analysis, Department of Commerce, measures purchases of goods and services by households and by nonprofit institutions that serve households from private business.

AUD/USD edges higher above 0.7050 as hot CPI lifts RBA rate hike odds

The AUD/USD pair gathers strength to near 0.7055 during the Asian trading hours on Thursday. The Australian Dollar edges higher against the US Dollar as hotter inflation data bolsters expectations of Reserve Bank of Australia rate hikes. The US September Personal Consumption Expenditures inflation report will be in the spotlight later on Thursday.

USD/JPY retakes 158.00 as USD stalls the post-FOMC corrective slide

USD/JPY attracts some dip-buyers during the Asian session on Thursday, climbing back above 158.00 as the US Dollar reverses part of the post-FOMC pullback from a two-week high. Bulls, however, await key US macro data – the Advance Q3 GDP and the PCE Price Index – before positioning for further gains. Focus will then shift to the crucial BoJ policy update on Friday amid firming expectations for a December rate hike.

Gold drops to two-day lows near $4,000

Gold leaves behind the recent three-day positive streak and faces renewed selling pressure near the $4,000 mark per troy ounce on Thursday. The yellow metal’s daily decline comes amid the firm performance of the US Dollar and mixed US Treasury yields, while crude oil prices remain on the back foot.

Top Altcoins Price Forecast: Ripple and Solana under pressure as Hyperliquid recovers

Ripple is down over 2% on Thursday, extending losses below $1.30 and capped below crucial moving averages. Solana drops 2% so far, testing its 200-day EMA and the $100 psychological level amid mounting selling pressure.

BoJ preview: Hawkish hold

Having hiked rates by 25bp to 1.25% in September, the central messages from the BoJ were largely similar; upside price risks remained, real interest rates were still negative and further policy rate hikes should be expected.

Anthropic pledged $270 billion to Amazon, Google, and Microsoft. Here's who actually gets paid

Anthropic owes Amazon, Google, and Microsoft at least $269.4 billion for computing power, even if it uses less. All three sell its models and handle its billing, and Amazon and Google own stakes and lend it money, so they get paid regardless of how the IPO goes. The Dario Amodei-led Anthropic filed its initial public offering (IPO) on Monday, seeking a listing on the Nasdaq under the ticker ANT.