- US dollar under pressure following Fed Chair Powell remarks.
- Decline in US yields weighs on USD/JPY that is ending a three-day positive streak.
The USD/JPY dropped further after the beginning of the American session and into the London fix, reaching at 109.95 the lowest level since last Friday.
Dollar under pressure as US yields slide
As of writing, USD/JPY trades at 111.10, down 50 pips for the day. A weaker US dollar pushed the pair to the downside affected by Fed’s Powell comments. He mentioned the labor market is still has a “long way to go”. He said inflation would likely remain elevated in the coming months.
Powell’s message was seen as “dovish” by market participants. US yields turned to the downside and stocks spike to the upside. Over the last hours, Wall Street indices moved off highs, supporting further the yen.
The DXY is falling after rising during two consecutive days and is back under 92.50. The 10-year yield fell to 1.36%, retreating from the weekly high it reached on Tuesday.
On Tuesday, the dollar soared across the board boosted by higher-than-expected inflation data. The PPI index also came in above expectations on Wednesday, but the numbers were offset by Powell’s comments.
Technical levels
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