USD/JPY trades under modest pressure on Wednesday as easing tensions in the Middle East and weaker US labour market data weigh on the US Dollar (USD).
At the time of writing, the pair trades around 157.45, down 0.20% on the day
The latest headlines suggest that the Strait of Hormuz could reopen soon, pushing Oil prices lower. US President Donald Trump said Washington had held “very good discussions” with Iran during all-day negotiations on Tuesday. Axios reported that the United States, Iran and Oman are close to an interim deal that could be announced as early as Wednesday.
Falling Oil prices ease global inflation concerns, reducing pressure on major central banks to raise interest rates. According to the CME FedWatch Tool, the probability of a September Fed rate hike has fallen to around 56% from 67% a day earlier. The US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, trades around 99.66, down 0.21% on the day.