- The Japanese Yen (JPY) rises as the market mood deteriorates
- Tokyo CPI is expected to rise to 3.5%
- The US Dollar (USD) is falling after weak US data
- US court blocks Trump’s trade tariffs
The US dollar against the Japanese yen (USD/JPY) exchange rate is falling after four days of gains. The pair fell 0.96% in the previous session, settling on Wednesday at 145.72. At 20:30 UTC, USD/JPY trades -1 % lower at 144.20 and trades in a range of 143.96 to 146.28.
The safe-haven Japanese yen initially dropped sharply on news that the US International Trade Court had blocked Trump’s trade tariffs, concluding that he had overstepped his powers by invoking emergency laws to justify trade levies. Initially, the market reacted with increased risk sentiment; however, this was quickly reversed as the market weighed up the ongoing uncertainty.
While the court has blocked Trump’s tariffs on trade, the White House is already appealing. This adds to the uncertainty over the outlook for U.S. trade policies, once again increasing safe-haven demand.
Attention is now turning to Tokyo inflation, which is expected to show that cool Tokyo CPI rose to 3.5% year on year in May, up from 3.4%. Hotter inflation supports expectations that the BoJ will hike rates again, keeping JPY supported.
The US Dollar is falling across the board. The US Dollar Index, which measures the greenback against a basket of major currencies, is -0.52% lower at 99.35 at the time of writing, after two days of gains.
The US dollar is falling, giving back earlier gains after disappointing US economic data, raising concerns over the US economic outlook.
Initial jobless claims rose by 240,000, up from 227,000 the previous week, ahead of estimates of 230,000. The data points to a slight uptick in layoffs. Meanwhile, continuing jobless claims also rose to 1.919 million, well ahead of estimates of 1.893 million, highlighting weakness in the jobs market.
Meanwhile, US GDP was revised higher to -0.2%, up from -0.3% annualised in the first quarter. However, analyzing the figures further reveals that US GDP consumption, which is a key component of the US economy, fell to 1.2%, down from an initial 1.8%, this month’s lowest level in two years.