Yen slides as BOJ core inflation higher than expected, US durable goods expected to plunge
BY
Ben Graham
|
By using this site, you agree to our Terms of Use of Use and Privacy Policy
The Japanese yen is down for a second straight day. In the European session, USD/JPY is trading at 144.14, up 0.91% on the day.
BoJ core CPI beats forecast, hits 2.4%
BoJ core CPI rose to 2.4% in April, after three straight readings of 2.2% and above the market estimate of 2.3%. This was the highest level since Jan. 2024. Japan's Services PPI also rose to 3.1% in April, lower than the upwardly revised 3.3% gain but above the market estimate of 3.0%.
This release comes on the heels of Japan's core CPI, which jumped in April to 3.5% from 2.4%, the highest level in two years. Core inflation has held above the Bank of Japan's 2% target for over three years but the central bank has been very slow to raise interest rates.
Governor Ueda said on Tuesday that the BoJ would adjust its rate policy "as needed" if economic expectations are met, a vague reference but still an acknowledgement that the next move will be a rate hike. The markets expect the BoJ to maintain its wait-and-see mode for some time, with a rate hike unlikely before September at the earliest.
The BoJ has revised lower its growth and inflation projections to the current economic uncertainties, particularly those related to US trade policy. The central bank meets next on June 17 and is widely expected to hold its policy settings steady.
US core durable goods expected to plunge
US markets are back in action after the Memorial Day holiday on Monday. US Durable Goods Orders are expected to slide by 7.8% in April, after a 7.5% gain in March, which was the fastest pace of growth since July 2020. As well, The Conference Board Consumer Confidence index, which has fallen steadily this year, is expected to improve to 87.0 from 86.0.
USD/JPY Technical
USDJPY 1-week Chart, May 27, 2025
Opinions are the authors'; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors.
If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please refer to the MarketPulse Terms of Use.
Visit https://www.marketpulse.com/ to find out more about the beat of the global markets.
© {CURRENT_YEAR} OANDA Business Information & Services Inc.