USD/JPY weakens below 152.50 as Japan’s Takaichi eases policy concerns
The USD/JPY pair attracts some sellers to around 152.20 during the early Asian session on Wednesday. The Japanese Yen (JPY) strengthens against the US Dollar (USD) after officials ease policy concerns. All eyes will be on the US Federal Reserve (Fed) interest rate decision later on Wednesday, where a 25 basis points (bps) rate cut is fully priced in.
US President Donald Trump and Japan’s Prime Minister Sanae Takaichi on Tuesday signed a framework for securing the supply of critical minerals and rare earths. Additionally, Takaichi and US Treasury Secretary Scott Bessent eased some concerns about more expansionary fiscal and monetary policy in the country.
Japan's Economic Minister, Minoru Kiuchi, said that Japan can boost its long-term potential growth by stimulating demand and keeping the labor market tight while being mindful of the need for fiscal discipline. Kiuchi added that the government will closely watch the impact of currency moves on Japan's economy.
The markets might turn cautious ahead of the Fed policy meeting later on Wednesday. The US central bank is expected to lower interest rates by a quarter point at its October meeting and could deliver further rate reductions at the next two meetings as well, according to the October CNBC Fed Survey.
The attention will shift to the Press Conference following the rate decision. Any dovish comments from Fed Chair Jerome Powell could weigh on the Greenback against the JPY in the near term.
Source: Fxstreet
