US Dollar weakens after June CPI data shows inflation cooling, reducing expectations for Federal Reserve rate hikes in 2024.
The USD/JPY pair fell to 162.20 in European trading on Wednesday, pressured by a weaker US Dollar as traders scaled back bets on Federal Reserve rate hikes. The US Dollar Index (DXY) dropped 0.16% to 100.78, its lowest level against the Euro today.
The decline follows softer-than-expected US Consumer Price Index (CPI) data for June, which showed headline inflation slowing to 3.5% year-on-year and core inflation easing to 2.6%. Fed Chair Kevin Warsh reiterated the central bank’s commitment to price stability but offered no new signals on policy timing.
Investors are also monitoring Bank of Japan (BoJ) policy cues amid speculation over another rate hike this year. Technically, USD/JPY remains near its 20-period EMA at 162.10, reflecting a sideways trend within an ascending triangle pattern.