Key Events Today:

12:30 UTC: USD – Core Personal Consumption Expenditures Index.

The Japanese yen (JPY) continues to lose ground against the US dollar (USD) on Friday after the Japan Statistics Bureau released the Consumer Price Index (CPI) data for Tokyo. However, the yen’s decline may be limited as traders may unwind their positions in anticipation of the Bank of Japan’s two-day meeting, which concludes on Wednesday. During the meeting, the Bank of Japan will discuss the possibility of raising interest rates and provide details on winding down large-scale bond purchases.

On Friday, Japan’s top currency diplomat, Masato Kanda, told G20 participants that currency exchange rate volatility (FX) is negatively impacting the Japanese economy. He highlighted the growing likelihood of a soft landing and emphasized the need to closely monitor the state of the economy and take necessary measures, according to Reuters.

The US dollar has received support as stronger US economic data has tempered some expectations of a rate cut in September. On Friday, attention will be focused on the release of the June Personal Consumption Expenditures (PCE) price index.

On Thursday, US Gross Domestic Product (GDP) for the second quarter (Q2) came in stronger than expected. This followed Wednesday’s US PMI data, which indicated an acceleration in private sector activity growth in July, suggesting robust growth in the US despite higher interest rates.

Recommendations: Trade primarily with Buy orders from the current price level.