- The USD/JPY is around 149.37, little changed after the Fed kept the rates without changes but decelerated the balance reduction.
- Inflation remains high “something”, with the Fed reviewing the PCE and the underlying PCE, while the estimates of GDP and unemployment were reduced.
- The governor of the Fed, Waller, disappointed, favoring a rhythm of balance reduction without changes, while markets digest mixed political signals.
The USD/JPY rises on Wednesday after the decision of the Federal Open Market Committee (FOMC) to keep the fees unchanged. Although the officials were cautious on the rates, the US dollar failed to recover strongly. The par is around 149.37, practically unchanged.
The dollar struggles to recover despite the cautious posture of the Fed on inflation and politics
In its monetary policy statement, the Federal Reserve acknowledged that labor market conditions remain solid, but noted that inflation remains “something” high. The FOMC reaffirmed its commitment to monitor the risks on both sides of its dual mandate and announced plans to decelerate the balance reduction rate from April.
The decision was unanimous, except for the governor of the Fed, Christopher Waller, who preferred to maintain the balance reduction rate without changes.
In the Summary of Economic Projections (SEP), the projection of the FED fund rate remained at 3.9%, without changes with respect to the December forecast. The projections of the officials for inflation were kept reviewed up, both for the PCE and for the underlying PCE data.
The US economy is expected to slow down the 2%threshold, indicating that the economy has become fragile amid the commercial policies of US President Donald Trump.
Source: Federal Reserve
USD/JPY reaction to the Fed decision
And in Japanese price today
The lower table shows the rate of change of Japanese Yen (JPY) compared to the main currencies today. Yen Japanese was the strongest currency in front of the euro.
| USD | EUR | GBP | JPY | CAD | Aud | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.54% | 0.16% | 0.04% | 0.20% | 0.35% | 0.49% | 0.24% | |
| EUR | -0.54% | -0.39% | -0.49% | -0.34% | -0.18% | -0.05% | -0.30% | |
| GBP | -0.16% | 0.39% | -0.10% | 0.05% | 0.22% | 0.34% | 0.08% | |
| JPY | -0.04% | 0.49% | 0.10% | 0.13% | 0.30% | 0.41% | 0.17% | |
| CAD | -0.20% | 0.34% | -0.05% | -0.13% | 0.17% | 0.30% | 0.02% | |
| Aud | -0.35% | 0.18% | -0.22% | -0.30% | -0.17% | 0.13% | -0.10% | |
| NZD | -0.49% | 0.05% | -0.34% | -0.41% | -0.30% | -0.13% | -0.26% | |
| CHF | -0.24% | 0.30% | -0.08% | -0.17% | -0.02% | 0.10% | 0.26% |
The heat map shows the percentage changes of the main currencies. The base currency is selected from the left column, while the contribution currency is selected in the upper row. For example, if you choose the Japanese yen from the left column and move along the horizontal line to the US dollar, the percentage change shown in the picture will represent the JPY (base)/USD (quotation).
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
