- The Japanese Yen (JPY) gains for a second day
- Attention turns to Friday’s data drop
- The US Dollar (USD) rises against major peers
- Trump’s tax cuts are passed by the House of Representatives
The US dollar Japanese yen (USD/JPY) exchange rate is falling for a second straight day The pair fell 0.43% in the previous session, settling on Tuesday at 149.06. At 19:30 UTC, USD/JPY trades -0.11% lower at 148.90 and is in a range of 148.62 to 149.89.
The Japanese yen remains supported near multi-month highs, boosted by rising expectations that the Bank of Japan will continue to hike interest rates this year after hotter-than-expected fourth-quarter inflation.
Attention is now turning to a series of key macroeconomic data points on Friday, including industrial production, retail sales, and take-care inflation, which could provide further insight into the Bank of Japan’s monetary policy outlook.
The yen has also benefited from safe haven demand after President Trump ordered a probe into potential tariffs on copper imports to boost US production of the key metal.
The US Dollar is falling against the yen but is rising against its major peers. The US Dollar Index, which measures the greenback against a basket of major currencies, is +0.15% to 106.46 at the time of writing, recovering from a 2-month low.
The US dollar and U.S. stocks are rising on Wednesday after House Republicans pushed forward President Trump’s tax cut plans and as treasury yields inched higher following a sharp drop yesterday.
The Republican-controlled U.S. House of Representatives narrowly passed Trump’s $4.5 trillion tax cut plans, pushing the budget resolution to the Senate, where Republicans are expected to take it up. This is expected to be good for corporate America, given that it means less regulation and tax cuts.
Meanwhile U.S. Treasury yields rose slightly as investors anticipate more debt issuance ahead. EU S10 year yield was up one basis point at 4.306 after falling almost 10 basis points yesterday. Yields fell sharply yesterday after weak consumer confidence data, so the market increased fed rate cut expectations.
