US Dollar Weakens Despite Fed Dissent, BOJ in Focus

The US dollar experienced a decline despite dissent from three Federal Reserve officials who favored a rate hike. The Fed held its interest rate target at 3.5%-3.75%, but the meeting was not seen as hawkish, and expectations for a second tightening cycle were pushed back.

With the Federal Reserve now behind us, attention turns to the Bank of Japan's upcoming meeting, where guidance rather than rates is expected to drive the next move in USD/JPY and GBP/JPY. The BOJ is widely anticipated to leave the policy rate unchanged after raising it to 1.0% in June.

The lack of a hawkish surprise remains the most likely outcome for the BOJ, which could weigh on the Japanese yen. This would favor GBP/JPY and USD/JPY bulls, particularly given the strong uptrends already in place.