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Yen steadies around 163.70 as oil rebounds and traders await Japan data

Tokyo CPI excluding fresh food is forecast to rise to 1.7% in July, while markets also weigh Fed timing and Middle East risk.

Reported · Written up by our desk · Major Pairs

USD/JPY is holding near 163.70 in Asian trade, after losing ground from the previous session’s small gains, as oil prices rebound and could weigh on the Japanese yen, FXStreet reports.

The outlook is also being shaped by renewed Middle East hostilities that have revived geopolitical tensions and risk concerns, FXStreet adds. The outlet notes investors may react through the interest rate outlook, including expectations around the Federal Reserve, which is widely expected to keep rates unchanged.

Traders are awaiting Japan’s inflation and labor data, with Tokyo CPI excluding fresh food expected to accelerate to 1.7% in July from 1.6% previously. The unemployment rate is forecast to remain at 2.5%, according to FXStreet, with prior figures also cited for context.

FXStreet also points to how the USD could find support from escalating risk aversion and how markets are pricing uncertainty around the Fed meeting, including a 30.5% chance of an immediate rate hike and a 76.6% probability of a rate increase in September.

Latest closeUSD/JPY 163.85 ▲0.1%

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