After the release of better-than-expected U.S. manufacturing data (New York Fed Index), some investors expected the U.S. economy to stay strong, which supported the dollar. However, Federal Reserve officials made cautious comments about future rate cuts. For example, Waller said he would support an early interest rate cut if recession risks grow.
Because of this, U.S. long-term interest rates went down. When interest rates fall, the dollar tends to weaken because investors look for better returns elsewhere. So, some traders started selling dollars and buying yen.
At the same time, Japan released strong machinery orders data this morning. This shows that Japanese companies are still investing, which gave the yen more support.
Even though U.S. stocks and the overall economy remain uncertain, there’s no clear direction yet. Investors are waiting for more information before making big moves.
Expected Range for USD/JPY: 142.00 – 144.50
Note: This information does not guarantee profits. Please make your own decisions when trading.