USD/JPY consolidates above 145.00 with all eyes on Fed’s decision
13.12.2023, 12:13

USD/JPY consolidates above 145.00 with all eyes on Fed’s decision

 

  • The remains moderately bid right with investors awaiting Fed’s decision.
  • Dovish comments from BoJ officials have weighed on the Yen.
  • USD/JPY is approaching trendline resistance at 146.20.


The US Dollar is moving without a clear direction with a moderately positive tone on Wednesday’s European session as the market awaits the outcome of the Federal Reserve’s meeting.

Recent US data supports the Dollar

US CPI data released on Tuesday revealed that consumer inflation remains sticky, despite the restrictive interest rates. This, coupled with the strong employment figures seen last Friday, has cooled market hopes of Fed cuts in early 2024 and cushioned US Dollar’s losses.

Investors are looking from the sidelines, awaiting the outcome of the Fed’s monetary policy meeting. The benchmark interest rate will remain unchanged, although the committee members’ rate projections and Chairman Powell’s comments might boost US Dollar volatility.

Beyond that, recent comments from BoJ officials crushed speculation about the possibility of a major monetary policy shift at next week’s meeting, increasing bearish pressure on the Yen.

From a technical perspective, the pair is approaching the falling trendline resistance from mid-November highs, now at 146.20.

Above here, the next targets would be 146.85, the 50% retracement of the November - December decline, and 147.50. Supports are 145.20 and 143.75.

Technical levels to watch

 

 

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