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USD/JPY: steady in Tokyo, consolidating FOMC activity

USD/JPY is steady in the Tokyo open after reaching a high of 109.44 overnight on the back of the FOMC outcome before selling off to a NY low of 108.99. Currently, USD/JPY is trading at 109.19, up 0.02% on the day, having posted a daily high at 109.27 and low at 109.10.

The yen was underperforming with the US benchmarks once again booking solid monthly gains and also on the back of the  BoJ comments yesterday on Tuesday where the Central Bank said it had increased its short maturity bond purchases.

FOMC review

Analysts at NBF Bank explained that the last FOMC meeting presided by Janet Yellen provided no major surprises, as the Fed opted to leave the fed funds rate unchanged at 1.25-1.50%. "There were, however, subtle but significant changes in the statement which altogether sounded a bit more hawkish. The Fed seems somewhat more confident about its inflation outlook, acknowledging the increase in market-based measures of inflation compensation, and expecting inflation to move up this year. This more confident tone reflects an improving economy that has made possible “solid” gains in employment, household spending, and business fixed investment. The FOMC still thinks near-term risks to the economic outlook are “roughly balanced”, but warned about “further” gradual interest rate increases."

Pre-FOMC, US 10yr treasury yields rose from 2.70% to 2.75% as a result while 2yr yields rose from 2.10% to 2.16%. The Fed fund futures increased the chance of another rate hike in March from 76% to 83%. As a result of the FOMC today, the Fed Funds are capped at 2.5% still with three hikes projected for the year.

USD/JPY levels

Valeria Bednarik, chief analyst at FXStreet explained that the longer-term perspective remains bearish for the pair:

"The longer-term perspective remains bearish for the pair. despite this latest recovery, although in the short-term, the advance could extend, considering technical readings in the 4 hours chart, as indicators have extended their advances into positive territory, to reach fresh 3-week highs. Nevertheless, the pair continues developing well below bearish moving averages, with the 100 SMA now around 110.30 in the mentioned chart, still moving much faster than the 200 SMA, a clear sign of bears'  domination," Valeria explained.

Gold remains bid, but stuck at key trendline hurdle

Gold (XAU/USD) is trading on the front foot in Asia just below the post-Fed high of $1347.58, but still below the resistance of accelerated trendline
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USD/JPY: Stabil di Tokyo, Konsolidasi Setelah FOMC

USD/JPY stabil di Tokyo setelah mencapai tinggi 109,44 semalam di belakang hasil FOMC sebelum menjual ke rendah NY 108,99. Saat ini, USD/JPY diperdaga
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