- The Japanese Yen (JPY) rises after 2 days of losses
- Gold reaches a record high
- The US Dollar (USD) falls against its major peers
- US core PCE was hotter than expected
The US dollar Japanese yen (USD/JPY) exchange rate is falling after two days of gains. The pair rose 0.18% in the previous session, settling on Thursday at 150.85. At 19:00 UTC, USD/JPY trades -0.56% lower at 150.00 and is in a range of 149.86 to 151.20.
The safe-haven Japanese yen rose on Friday, along with other safe havens such as gold, which reached a fresh record high, boosted by concerns about a looming trade war sparked by President Trump’s tariff policy.
Hotter-than-expected US inflation data come as Trump is set to announce reciprocal trade tariffs on April 2. The markets are worried about the potential impact on the global economy and the US economy.
The US Dollar is falling across the board. The US Dollar Index, which measures the greenback against a basket of major currencies, is 0.29% lower at 104.03 at the time of writing and is set to fall 0.05% across the week.
The U.S. dollar is under pressure following hotter-than-expected PCE data. The Fed’s preferred gauge for inflation rose to 2.8% year on year, up from 2.5% in January. On a monthly basis, core PCE rose 0.4% ahead of expectations of 0.3%; meanwhile, consumer spending was weaker than expected at just 0.1%.
The data points to a weakening growth outlook and rising inflation at a time when Trump’s trade tariffs could further increase price pressures.
This week, Trump announced 25% trade tariffs on all car imports into the US, and next week, he is expected to announce reciprocal tariffs on April 2, although the extent of this is not yet known.
Adding to the downbeat mood, the Fed Atlanta now GDP points Q1 GDP -2.8% from a 1.8% contraction previously.