- The Japanese Yen (JPY) rises for a third day
- The yen rises as do safe havens Gold and Silver
- The US Dollar (USD) falls versus its major peers
- Trade jitters and Fed rate cut expectations
The US dollar Japanese yen (USD/JPY) exchange rate is falling for a third straight session. The pair fell 0.57% in the previous session, settling on Wednesday at 150.99. On Thursday at 21:00 UTC, USD/JPY trades -0.38% at 150.41 and traded in a range of 150.21 to 151.40.
. The Japanese yen is benefiting from safe-haven flows amid ongoing uncertainties surrounding geopolitical tensions, trade tariffs, and the ongoing U.S. government shutdown. Other safe havens, such as gold and silver, also trade at record levels.
The upsides of political uncertainty as LDP leader Sanae Takaichi’s path to becoming Prime Minister narrows. The vote was initially scheduled to take place on Wednesday, but the sudden withdrawal of coalition partner Komeito means the election has been pushed back to October 21.
The US Dollar is falling across the board. The US Dollar Index, which measures the greenback against a basket of major currencies, is falling 0.44% at 98.36, extending losses from yesterday.
The U.S. dollar is falling against its major peers, as investors worry about U.S.-China trade tensions and a lack of fresh data, alongside expectations that the Federal Reserve will cut rates again this month.
U.S.-China trade jitters are dampening demand for the US dollar ahead of key talks between President Trump and China’s Xi Jinping later this month in South Korea. The market is anxiously awaiting confirmation that recent tariff threats are indeed just that. In a successful meeting between the two leaders, I see recent measures downwardly played or removed.
Meanwhile, the US dollar is also under pressure as the market ramps up Fed rate cut expectations. The market says a 93% probability of 225 basis point rate cuts before the end of the year.
However, with the Fed now in its blackout period and with economic data scarce owing to the US government lockdown, fresh catalysts may be few and far between.
