USD/JPY drops to fresh daily low, closer to mid-134.00s post-US CPI

USD/JPY retreats sharply from a one-week high amid the emergence of fresh USD selling.
The softer headline US CPI print reaffirms dovish Fed expectations and weighs on the USD.
A positive risk tone could undermine the safe-haven JPY and help limit losses for the pair.

Haresh Menghani FXStreet

The USD/JPY pair attracts some sellers in the vicinity of mid-135.00s, or a one-week high touched this Wednesday, and the intraday descent picks up pace following the release of the US consumer inflation figures. Spot prices drop to a fresh daily low during the early North American session and currently trade just above the mid-134.00s, down over 0.50% for the day.

The US Dollar (USD) weakened across the board after the US Bureau of Labor Statistics reported that inflation in the US, as measured by the Consumer Price Index (CPI) rose 0.4% in April and the yearly rate eased to 4.9% from 5%. Meanwhile, the Core CPI, which excludes volatile food and energy prices, matched expectations, coming in at 0.4% and 5.5%, respectively, Nevertheless, the data reaffirms market bets for an imminent pause in the Federal Reserve's (Fed) year-long rate-hiking cycle, which weighs heavily on the Greenback and exerts downward pressure on the USD/JPY pair.

However, the Bank of Japan's (BoJ) dovish stance, along with a generally positive tone around the equity markets, could undermine the safe-haven Japanese Yen (JPY) and help limit losses for the USD/JPY pair. It is worth recalling that BoJ Governor Kazuo Ueda, speaking in parliament earlier today, said that it was too early to discuss specific plans for an exit from the massive stimulus programme. This, in turn, might hold back bearish traders from placing aggressive bets and act as a tailwind for spot prices, making it prudent to wait for strong follow-through selling before positioning for further losses.

Technical levels to watch

USD/JPY

Overview
Today last price	135.32
Today Daily Change	0.13
Today Daily Change %	0.10
Today daily open	135.19

Trends
Daily SMA20	134.56
Daily SMA50	133.84
Daily SMA100	132.85
Daily SMA200	137.02

Levels
Previous Daily High	135.36
Previous Daily Low	134.72
Previous Weekly High	137.78
Previous Weekly Low	133.5
Previous Monthly High	136.56
Previous Monthly Low	130.63
Daily Fibonacci 38.2%	135.12
Daily Fibonacci 61.8%	134.97
Daily Pivot Point S1	134.82
Daily Pivot Point S2	134.45
Daily Pivot Point S3	134.18
Daily Pivot Point R1	135.46
Daily Pivot Point R2	135.73
Daily Pivot Point R3	136.1

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

EUR/USD steadies near 1.1650 ahead of US Nonfarm Payrolls

EUR/USD holds ground after five days of losses, trading around 1.1650 during the Asian hours on Friday. Traders remain cautious ahead of the US Nonfarm Payrolls report, which is expected to offer further insight into labor market conditions and the Federal Reserve’s policy outlook. December NFP is forecast to show job gains of 60,000, down from 64,000 in November.

GBP/USD: Further weakness could challenge 1.3400

GBP/USD remains under unabated selling pressure on Thursday, slipping to fresh three-day lows around 1.3415 in response to further improvement in the sentiment surrounding the Greenback ahead of Friday’s key NFP data.

Gold edges lower as bulls opt to wait for the crucial US NFP report

Gold struggles to capitalize on the previous day's goodish move up from the vicinity of the $4,400 mark and attracts some sellers during the Asian session on Friday as bulls seem reluctant ahead of the US NFP report. The critical US employment details will offer more cues about the Fed's rate-cut path, which, in turn, will influence the US Dollar price dynamics and provide a fresh impetus to the non-yielding bullion. In the meantime, dovish Fed expectations and rising geopolitical tensions might continue to act as a tailwind for the XAU/USD.

XRP slides as institutional and retail demand falters

Ripple (XRP) is trading down for the third consecutive day on Thursday amid escalating volatility in the cyrptocurrency market. After peaking at $2.41 on Tuesday, its highest print since November 14 amid the early-year rally, XRP has quickly ran into aggressive profit-taking.

2026 economic outlook: Clear skies but don’t unfasten your seatbelts yet

Most years fade into the background as soon as a new one starts. Not 2025: a year of epochal shifts, in which the macroeconomy was the dog that did not bark. What to expect in 2026? The shocks of 2025 will not be undone, but neither will they be repeated.

XRP slides as institutional and retail demand falters

Ripple is trading down for the third consecutive day on Thursday amid escalating volatility in the cyrptocurrency market. After peaking at $2.41 on Tuesday, its highest print since November 14 amid the early-year rally, XRP has quickly ran into aggressive profit-taking.