USD/JPY hovers above 146.00, focus on speeches from Fed Chair Powell, BoJ Governor Ueda

• USD/JPY strengthened on Japanese inflation and US employment data.
• Traders turn cautious ahead of speeches from central banks in Jackson Hole.
• Japan’s inflation fell amid US Initial Jobless claims printed lower than expected.

USD/JPY trades higher around 146.10, recovering the recent losses during the early trading hours in the European session on Friday. The Japanese (Yen) experiences downward pressure due to mixed Japan’s inflation figures.

Tokyo Consumer Price Index (CPI) for August fell to 2.9% on the annual rate vs. 3.0% expected, from the 3.2% prior. Meanwhile, Tokyo CPI ex Food, Energy (YoY) remained consistent at 4% whereas Tokyo CPI ex Fresh Food (YoY) declined to 2.8% against the market consensus of 2.9%. The index printed the 3% figure in July.

On the other hand, US Initial Jobless Claims for the week ending on August 18, declined to 230K compared to the expectations of 240K, remaining consistent as prior. However, US Durable Goods Orders for July fell 5.2% compared to the market consensus of 4%, swinging from the previous figure of 4.4%.

The US Dollar Index (DXY), which measures the performance of the US Dollar (USD) against six major currencies, hovers around 104.20 ahead of Fed Chair Powell’s speech. The USD/JPY traders will also closely monitor the Bank of Japan (BoJ) Governor Kazuo Ueda’s speech at the Jackson Hole Symposium on Saturday, seeking insights into the financial and economic sectors, helping to shape potential strategies in response to place bets on USD/JPY pair.

Furthermore, The USD/JPY pair strengthened due to robust United States (US) employment data, higher US Treasury yields, and mixed sentiment around monetary policy tightening by the US Federal Reserve in the September meeting. Additionally, the US-China situation coupled with China’s economic woes contributed to the pair’s strength as a result of the export-trade ties between the two countries.