- USD/JPY has shed 20 pips in the last hour.
- The dollar is on the defensive, possibly due to dovish Fed expectations.
- AUD/JPY selling may have weighed over USD/JPY.
USD/JPY is feeling the pull of gravity this Tuesday morning in Asia with the US dollar losing ground against most majors except the AUD.
The currency pair is currently trading at 108.34, having shed 22 pips over the last sixty minutes or so.
The moderate drop could be associated with the broad-based US Dollar weakness, as represented by the Dollar Index, which is currently trading at 97.45 - down 15 pips from the overnight high of 97.60.
The greenback has come under pressure, possibly due to the widespread expectation that the Federal Reserve would lay the groundwork for a rate cut later this year. The central bank is scheduled to announce its decision on interest rates at 18:00 GMT on Wednesday.
Also, the selling in the AUD/JPY cross may have added to the bearish pressure around the USD/JPY pair. The JPY cross fell to fresh five months lows earlier today in response to dovish RBA minutes and a weaker-than-expected Aussie house price index figures.
Bank of Japan's Kuroda, while speaking in parliament earlier today, took note of the heightened uncertainty in the global economy. His dovish comments, however, have been ignored by markets. Moreover, it is generally accepted by now that the BOJ has exhausted its ammo and the central bank is unlikely to achieve its 2% inflation target any time soon.
Looking forward, the pair may remain under pressure, courtesy of dovish Fed expectations.
Pivot levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD regains traction, recovers above 1.0700
EUR/USD regained its traction and turned positive on the day above 1.0700 in the American session. The US Dollar struggles to preserve its strength after the data from the US showed that the economy grew at a softer pace than expected in Q1.
GBP/USD returns to 1.2500 area in volatile session
GBP/USD reversed its direction and recovered to 1.2500 after falling to the 1.2450 area earlier in the day. Although markets remain risk-averse, the US Dollar struggles to find demand following the disappointing GDP data.
Gold climbs above $2,340 following earlier drop
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
XRP extends its decline, crypto experts comment on Ripple stablecoin and benefits for XRP Ledger
Ripple extends decline to $0.52 on Thursday, wipes out weekly gains. Crypto expert asks Ripple CTO how the stablecoin will benefit the XRP Ledger and native token XRP.
After the US close, it’s the Tokyo CPI
After the US close, it’s the Tokyo CPI, a reliable indicator of the national number and then the BoJ policy announcement. Tokyo CPI ex food and energy in Japan was a rise to 2.90% in March from 2.50%.