The Yen Is Kicking Back - Could USD/JPY Break 155?
The USD/JPY pair weakened to around 155.10 at the start of the Asian session on Tuesday. The yen strengthened slowly as markets became increasingly confident that the Bank of Japan (BoJ) would raise interest rates at its policy meeting on Friday, increasing pressure on the dollar.
Market bets on a BoJ interest rate hike are growing. Reuters reports that the BoJ is likely to remain committed to continuing to raise interest rates, but the pace will depend on the Japanese economy's response. In a Reuters survey (December 2–9), 90% of economists predicted the BoJ would raise the short-term interest rate to 0.75% from 0.50%—a sharp increase from last month's survey of 53%.
Meanwhile, the US dollar is still waiting for a silver lining from the release of key US economic data due this Tuesday, including Retail Sales, PMI, and the employment report (NFP), which was delayed due to the government shutdown. If the employment data is strong, the dollar could rebound and stem the USD/JPY's decline. But if the data weakens, the market could become more convinced that the Fed will be more dovish—and that could cause USD/JPY to fall further. (az)
Source: Newsmaker.id
