Japanese Yen comes under pressure as US PPI data boost US Dollar
- USD/JPY gains 0.40% on Thursday, supported by renewed US Dollar strength following US economic data.
- US producer prices accelerate in August, while Initial Jobless Claims decline to 206K.
- Markets now turn their attention to US inflation data due on Friday.
USD/JPY advances to around 154.15 on Thursday at the time of writing, up 0.40% on the day. The pair benefits from a rebound in the US Dollar (USD), supported by US data showing accelerating producer price pressures and a still-resilient labor market.
The United States (US) Producer Price Index (PPI) rose 5.4% YoY in August, above the 5.3% expected and accelerating from the previous 4.8% increase after revision. The core PPI, which excludes volatile food and energy components, increased 4.6% YoY, matching expectations and up from a revised 4.3% rise in July. On a monthly basis, headline PPI increased 0.4%, while the core index rose 0.2%.
Meanwhile, Initial Jobless Claims declined to 206K in the week ending September 5, compared with 207K in the previous week and slightly above expectations of 205K. Continuing Jobless Claims also edged lower to 1.774M, reinforcing the view that the US labor market remains relatively resilient.
The PPI data further strengthen expectations of a Federal Reserve (Fed) interest-rate hike in September. According to the CME FedWatch tool, markets now price in nearly a 70% chance of a rate increase, up from around 61% before the data were released.
On the Japanese side, the Japanese Yen (JPY) pauses after its recent rebound fueled by more hawkish expectations surrounding the Bank of Japan (BoJ). Markets fully price in a 25-basis-point rate hike at the September meeting, while recent comments from several central bank officials have reinforced expectations of further monetary policy normalization. This dynamic could, however, limit the extent of the USD/JPY advance.
Market attention now turns to the US Consumer Price Index (CPI) data due on Friday. The inflation report is likely to play an important role in shaping expectations for the Fed's interest-rate path. A stronger-than-expected inflation reading could support the US Dollar, while a sharper slowdown in price pressures could weigh on the Greenback, and in turn on USD/JPY.
Japanese Yen Price Today
The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.17% | 0.22% | 0.35% | 0.12% | 0.76% | 0.63% | 0.28% | |
| EUR | -0.17% | 0.05% | 0.16% | -0.06% | 0.59% | 0.45% | 0.11% | |
| GBP | -0.22% | -0.05% | 0.12% | -0.12% | 0.53% | 0.39% | 0.06% | |
| JPY | -0.35% | -0.16% | -0.12% | -0.25% | 0.40% | 0.23% | -0.07% | |
| CAD | -0.12% | 0.06% | 0.12% | 0.25% | 0.65% | 0.50% | 0.18% | |
| AUD | -0.76% | -0.59% | -0.53% | -0.40% | -0.65% | -0.13% | -0.43% | |
| NZD | -0.63% | -0.45% | -0.39% | -0.23% | -0.50% | 0.13% | -0.29% | |
| CHF | -0.28% | -0.11% | -0.06% | 0.07% | -0.18% | 0.43% | 0.29% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).
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