Soft US consumer sentiment and inflation data weigh on the dollar, but yen selling pressure keeps the pair rangebound.
USD/JPY trades near 159.40, unchanged on the day, as weaker-than-expected US consumer sentiment counters yen selling. The University of Michigan’s preliminary Consumer Sentiment Index fell to 51 in August, missing forecasts of 54.5 and marking the latest in a string of soft US economic prints.
The dollar index (DXY) retreated following the data, which included cooler inflation and weak retail sales earlier in the week. However, the yen’s decline persists as Tokyo refrains from further intervention after July’s record joint US-Japan action, emboldening speculators to resume selling the currency.
Technical indicators show USD/JPY holding above its 20-period simple moving average at 159.33 but capped below the 100-period SMA at 160.20. The Relative Strength Index near 56 suggests modest upward momentum without overbought conditions.