Japanese Yen Remains Strong Amid Expectations Of Aggressive Boj
The Japanese Yen (JPY) remained firm against its US counterpart for the third straight day on Monday (02/06) and looks set to strengthen further amid a combination of supportive factors. The Tokyo Consumer Price Index (CPI) released on Friday indicated that core inflation rose more than expected in May and reaffirmed bets that the Bank of Japan (BOJ) will continue to raise interest rates. Further, ongoing trade-related uncertainties and geopolitical risks turned out to be key factors supporting the safe-haven JPY.
Meanwhile, comments from Japan’s top trade negotiator Ryosei Akazawa indicated progress in trade talks with the US and fueled hopes of an imminent deal as early as this month, which in turn, provided additional support to the JPY. The US Dollar (USD), on the other hand, attracted fresh sellers on growing acceptance that the Federal Reserve (Fed) will lower borrowing costs further amid signs of easing inflation. This further benefitted the lower-yielding JPY and dragged the USD/JPY pair below mid-143.00s during the Asian session.
Source: FXStreet