Yesterday, with the Tokyo market closed, U.S. long-term interest rates fell at the start, and USD/JPY dropped to 147.36. Later, selling of the yen pushed the pair up to 148.24 before closing. The yen weakened due to the upcoming U.S.–Russia meeting and President Trump’s announcement of a 90-day delay in high tariffs on China, which made investors take more risks.
Before today’s U.S. CPI data, there was also some buying back of dollars as traders adjusted their positions.
For July, CPI is expected to rise from 2.7% to 2.8% year-on-year, and core CPI from 2.9% to 3.0%. This small change is not expected to affect the U.S. Federal Reserve’s plan for interest rate cuts. If CPI is higher than expected, it may surprise the market and cause dollar buying. If it is lower, expectations for more rate cuts will grow, and the dollar may be sold.
However, this CPI alone will not change the Fed’s policy. The market will keep watching job data and other results. Even if USD/JPY rises, it may only be temporary.
Expected USD/JPY Range: 147.30 – 148.80 yen
Note: This information does not guarantee profits. Please make your own decisions when trading.