USDJPY was last up 0.24% at 142.18 after dropping to 140.95 on Thursday, the lowest since July 31. The greenback is on track to post its worst week against the Japanese currency since July 14, with a 1.94% fall.
USDJPY Daily Chart
Fed Chairman Jerome Powell’s recent dovish tone and updated interest rate projections have significantly impacted the dollar. However, if inflation falls as anticipated, Atlanta Fed President Raphael Bostic’s statement regarding potential interest rate reductions in the third quarter of 2024 has added complexity to market expectations.
Amidst concerns about manufacturing activity in the US and the impact of strikes on production, the dollar index rebounded slightly on Friday, reaching 102.52, following a low of 101.76 on Thursday.
Meanwhile, in the eurozone, the euro fell 0.83% to $1.0899 due to deeper-than-expected downturns in business activity. The European Central Bank and the Bank of England’s resistance to rate cuts has supported the euro and sterling despite heavy market speculation on potential rate cuts from both banks in the coming year.
Investors are closely watching the Bank of Japan’s upcoming meeting, anticipating signals regarding its policy on rock-bottom interest rates.
