USD/JPY Rangebound as Weaker US Data Meets Rising BoJ Hike Expectations
The USD/JPY pair traded near 157.65 on Wednesday, largely unchanged as weakness in the US Dollar balanced growing support for the Japanese Yen.
Softer-than-expected US economic data weighed on the Greenback, while expectations of additional interest rate increases by the Bank of Japan (BoJ) continued to underpin the Yen, leaving the currency pair confined to a narrow trading range.
The ADP Employment Change report revealed that the private sector created only 44,000 jobs in July, falling short of the 70,000 expected and slowing from 98,000 in June. The Institute for Supply Management (ISM) reported its Services PMI eased to 54.1, slightly below the consensus forecast of 54.5.
Investors continued to evaluate the BoJ’s June meeting minutes, which revealed ongoing discussions about the need for further interest rate increases to address inflation risks. BoJ Governor Kazuo Ueda has repeatedly emphasized that the central bank remains prepared to continue normalizing monetary policy if economic conditions remain supportive, strengthening expectations of future tightening.