Trending
usdjpy
Source: Newsmaker.id
The Japanese yen came under pressure again on Thursday (September 10th), after the US dollar strengthened following the release of US economic data. USD/JPY hovered around 153.93, supported by a rise in the greenback after US producer inflation data showed persistent price pressures.
The US Producer Price Index (PPI) rose 5.4% year-on-year in August, exceeding market expectations of 5.3% and up from the previous month's revised 4.8%. The core PPI, which excludes food and energy components, rose 4.6% year-on-year, in line with expectations and higher than the 4.3% in July.
On a monthly basis, the headline PPI rose 0.4%, while the core PPI increased 0.2%. This data reinforces the view that inflationary pressures at the producer level have not fully subsided, particularly amid rising energy and input prices.
US employment data also showed resilience. Initial Jobless Claims fell to 206,000 in the week ending September 5, from 207,000 the previous week, although slightly above expectations of 205,000. Continuing Jobless Claims also fell slightly to 1.774 million.
The combination of a warmer PPI and a still-solid labor market has raised expectations for a Fed rate hike. According to the CME FedWatch Tool, the probability of a rate hike at the September meeting is now approaching 70%, up from around 61% before the data was released.
Newsmaker Analysis: The strengthening of USD/JPY indicates the market is again supporting the US dollar after the PPI data reinforced the Fed's hawkish narrative. However, the pair's gains could remain restrained as the market also expects the Bank of Japan to raise interest rates by 25 basis points at the September meeting. The next major focus is on Friday's US CPI data. If the CPI is hotter than expected, USD/JPY could strengthen again. Conversely, if inflation declines sharply, the US dollar could lose momentum and give the yen room to rebound. (asd)