USD/JPY oscillates around 143.50 as investors await fresh development on BOJ intervention

The USD/JPY pair is displaying back-and-forth moves in a narrow range of 143.15-143.56 in the Asian session. The asset has turned sideways after a firmer decline at around 145.00 as investors are awaiting the latest developments on the Bank of Japan (BOJ)’s intervention in Fx moves.

Awaits more development on BOJ intervention

Investors are aware of the fact that the Japanese administration is worried about depreciating the Japanese yen. Earlier, the Japanese economy was enjoying the falling yen as it was delighting their exports and tourism business. But not the over-riped fruit is creating hurdles for the economy. The corporate is facing the headwinds of costly inputs imported from other countries.

Companies that are highly import-inputs dependent are struggling to keep their operating margins intact. Their failure in passing the impact of higher input prices to the end-consumers due to country risk is forcing them to shut down their production. The impact will be revealed in the upcoming earnings season.

Now, Japanese officials feel that the fundamentals of the economy don’t justify the downside pressure and have discussed intervention in Fx moves with the Bank of Japan (BOJ). A seldom decision of intervening is not expected to be welcomed by other G7 countries. While a change in stance on policy seems to be the potential way to provide a cushion to the falling yen.

US Michigan Consumer Sentiment Index eyed

In today’s session, investors’ entire focus will remain on the US Michigan Consumer Sentiment Index, which is seen higher at 60 against the prior release of 58.2. It is worth noting that the sentiment data is in a recovery mode after dropping to 50 in June. In the past two months, the confidence of consumers is returning led by a solid labor market, falling gasoline prices, and higher growth prospects.