Start
trading

Main >
Analytics
>
Fresh forecast
>
Forex Fundamental Analysis
>
The divergence in BoJ and Fed policy expectations proved to be a key factor exerting pressure

The divergence in BoJ and Fed policy expectations proved to be a key factor exerting pressure | 11 September 2024

11 September 2024, USD/JPY

The divergence in BoJ and Fed policy expectations proved to be a key factor exerting pressure

Event to pay attention to today:

15:30 GMT+3. USD - Consumer Price Index

USDJPY:

The USD/JPY currency pair is still under pressure from selling for the second consecutive day on Wednesday. However, it has found support near 142.00 and has recovered a few pips over the past hour. The current spot price is trading around 142.30, which is close to the one-month low reached last week.

The decline is being driven by contrasting monetary policies from the Bank of Japan (BoJ) and the Federal Reserve (Fed), which is continuing to facilitate the unwinding of carry trades and directing flows towards the Japanese Yen (JPY). Indeed, BoJ Governor Kazuo Ueda has reiterated his willingness to maintain the current interest rate level if the Japanese economy meets the central bank's economic forecasts through fiscal 2025.

In contrast, the market is fully anticipating a 25-basis-point interest rate cut by the Fed at its upcoming meeting on 17-18 September. This ultimately hindered the US dollar (USD) from consolidating the levels achieved over the past three days. Furthermore, the cautious market sentiment is supportive of the Japanese Yen's safe-haven status, exerting downward pressure on the USD/JPY pair.

The aforementioned fundamental backdrop favours bearish traders and suggests that the path of least resistance for spot prices lies on the downside. However, investors may prefer to wait for the release of the important US Consumer Price Index (CPI) report to gain insight into how the Fed will cut rates. This will play a pivotal role in influencing USD price action in the near term and will provide fresh impetus to the USD/JPY pair.

Trade recommendation: Trading predominantly Sell orders from the current price level.

Fund your account with cryptocurrency and you will receive up to 10% in balance on your first deposit. The additional funds will be used for trading, increasing trading volumes and helping you withstand drawdowns.

David Johnson
Analyst of «FreshForex» company
Agree with the review?
Traders' opinion:
Close
Log in

Show password

Hide password

 Forgot password?
Your browser does not support cookie. If cookie is disabled in your Internet browser, you may have problems with accessing Client Area. How to enable cookie .

Our best awards:

FreshForex is a brand that provides access to online trading for clients from more than 158 countries all over the world. The Company's partners are the licensed European liquidity providers, banks, payment aggregators and systems with which the company has been cooperating for more than 19 years.
Clients must be at least 18 years old to use the services of the Company.
The company's services and information on the site are not intended for citizens and residents of some countries, such as Belgium, China, North Korea, France, Hong Kong, Russian Federation, Spain, Great Britain, USA, and also countries identified by the FATF as high-risk countries or countries with serious AML/CFT deficiencies; countries or regions that are under international sanctions. A complete list is available on the "Countries where the company's services are not provided" page. The Company does not have representative offices in the Russian Federation and does not register clients from the Russian Federation.
Risk Warning: Trading financial instruments with leverage carries high risks and can result in both profits and losses. Potential losses are limited by the deposit amount. Before deciding to trade, the client should assess their risk tolerance, experience, and knowledge level.

Freshforex.com uses cookies for better website operation, traffic flow analysis, and personalization. By using this website you agree to our Cookie Policy.
User Data privacy is protected in accordance with GDPR. The SSL certificate installed on the website transfers the information over a secure protocol.
The site contains links to websites of third parties. The Company does not check or control the third-party resources that are in any way related to the FreshForex site, so the Company is not responsible for any third-party information or materials posted.
By creating a link to a third party website, the Company does not endorse or recommend any products or services offered by the third party.
The website content is intended for informational purposes only. It should not be regarded as an offer or solicitation to any person in any jurisdiction in which such an offer or solicitation is not authorized. It also should not be considered as an offer/solicitation to any person to whom it would be unlawful to make such an offer or solicitation, nor regarded as a recommendation to buy, sell or otherwise deal with any particular currency or any other trading asset investment. If you are not sure about your local trading regulations, please, leave this website immediately.
© 2004—2024 FreshForex – Forex broker
Reproduction of the contents is allowed only with active hyperlink to original source.
Riston Capital Ltd (20623 BC 2012) with registered address at Suite 305, Griffith Corporate Centre, Beachmont, P.O. Box 1510, Kingstown, Saint Vincent and the Grenadines.