USD/JPY trades around 162.90 at the time of writing on Thursday, down 0.31% on the day, as the US Dollar (USD) comes under pressure following the Federal Reserve (Fed) meeting on Wednesday and a series of weaker-than-expected United States (US) economic data released earlier in…
e day, ahead of the Bank of Japan’s (BoJ) monetary policy decision. The US Gross Domestic Product (US) expanded at an annualized rate of 1.5% in the second quarter, below the market expectation of 2.1% and following 2.1% growth in the first quarter
According to the Bureau of Economic Analysis (BEA), the slowdown mainly reflects a decline in government spending and slower investment and export growth, partly offset by stronger consumer spending. At the same time, inflation data reinforced the narrative of a gradual disinflation process. The Personal Consumption Expenditures (PCE) Price Index, the Fed’s preferred inflation gauge, fell by 0.1% MoM in June, while the annual rate slowed to 3.7% from 4.1%.
The Core PCE Price Index slowed to 3.3% YoY from 3.4% in the previous month, in line with market expectations. On Wednesday, the Fed left its benchmark interest rate unchanged at 3.5%-3.75%, as widely expected, while maintaining a hawkish tone. The decision saw three dissenting votes in favor of an immediate rate hike, reinforcing expectations that policymakers remain concerned about persistent inflation.