USD/JPY is trading near 150.00, fear of intervention remains intact

• USD/JPY remains around 150.00 while fears of intervention in Japan remain intact.
• US annualized GDP is expected to be 4.1% despite the Fed raising interest rates.
• Japan’s stealthy intervention will no longer be able to offer stability to the Japanese Yen.

The USD/JPY pair consolidates in a tight range near the crucial resistance of 150.00. The pair seems optimistic, as investors expect the Federal Reserve (Fed) to maintain the high rate policy for a long period, if not discuss raising interest rates further.

S&P500 futures are down in the European session, indicating a state of risk aversion amid tensions in the Middle East. U.S. stocks sold off sharply on Friday amid geopolitical tensions and the tech earnings report. The 10-year US Treasury yield rose as high as 5% ahead of crucial economic data.

The DXY Dollar Index consolidates above 106.00 as investors focus on US third quarter Gross Domestic Product (GDP) data due on Thursday. Annualized GDP is expected at 4.1% despite the Fed’s interest rate hike.

Regarding the Fed’s interest rate outlook, its chair, Jerome Powell, supported a stable interest rate policy against a backdrop of rising long-term US Treasury yields. Jerome Powell commented that rising yields are impacting current financial conditions. Philadelphia Fed President Patrick Harker was in favor of maintaining interest rates as the economy is weakening more than expected.

Regarding the Japanese Yen, investors are attentive to the intervention of the Japanese authorities in the currency space to provide support to the weakening of the Yen. Investors hope that the stealth intervention cannot provide longer-term stability to the Japanese Yen as the tide is against the currency due to the Bank of Japan’s (BoJ) continuing expansionary policy.