The Fed looks closer to winning | 12 May 2023

12 May 2023, USD/JPY

USDJPY trading plan:

The number of Americans filing new claims for unemployment benefits jumped to a 1-1/2-year high last week, pointing to cracks in the labor market as demand slows, potentially giving the Federal Reserve room to halt further interest rate increases next month. With demand cooling, inflation pressures are subsiding. Producer prices rebounded modestly in April, leading to the smallest annual increase in wholesale inflation in more than two years, other data from the Labor Department showed. Last week's surge could mark the start of an upward trend as the cumulative and lagged effects of the Fed's rate hikes broaden out in the economy. Layoffs, which were initially concentrated in the technology and housing sectors, appear to be spreading to other industries as companies gear for weak demand.

Investment idea: sell 135.00 and take profit 134.09.

David Johnson
Analyst of «FreshForex» company
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