Yen Weakens, USD/JPY Breaks 147!
The Japanese Yen (JPY) weakened on Tuesday morning after briefly touching a two-week high against the US Dollar (USD), which has since begun to rebound. The USD/JPY pair rose above 147, fueled by concerns that domestic political uncertainty could hamper the Bank of Japan's (BoJ) policy normalization efforts, especially amid signs of slowing inflation.
However, the minutes of the BoJ's June meeting released today still indicated market confidence that the BoJ is likely to raise interest rates before the end of the year. Furthermore, the upwardly revised Japanese Services PMI data helped to contain the yen's decline.
On the other hand, global markets are increasingly convinced that the Federal Reserve will begin cutting interest rates at its upcoming September meeting. This prospect could hinder further strengthening of the US Dollar and limit the USD/JPY pair's gains in the near term.
The generally positive market sentiment also reduces the yen's appeal as a safe-haven asset. Investors are now shifting their focus to key economic data and central bank policy directions to determine their next investment moves. (ayu)
Source: Newsmaker.id
