Weaker-than-expected Japan CPI inflation data pressures the yen, lifting the USD/JPY pair in early Asian trading.
The Japanese yen declined against the US dollar, with the USD/JPY pair climbing to 159.10 in early Asian trading on Friday. The move follows softer Japan inflation data, which reduced expectations for further monetary tightening by the Bank of Japan.
Japan’s latest consumer price index (CPI) figures fell short of market forecasts, signaling persistent disinflationary pressures. The yen’s weakness contrasts with recent trends, as investors recalibrate bets on the Federal Reserve’s policy path ahead of US consumer sentiment data later today.
Traders are now focused on the US May Michigan Consumer Sentiment Index, which could influence Fed rate cut expectations and further impact the USD/JPY pair.