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Yen strengthens as US PCE cools and Fed hike timing shifts

USD/JPY fell about 0.3% to around 156.8 after headline PCE inflation held at 3.4% year over year in August, below the 3.7% median forecast.

Reported · Written up by our desk · Major Pairs

FXStreet said the Japanese yen strengthened on Wednesday, with USD/JPY down about 0.3% and trading around 156.80 as the US dollar faced selling pressure after softer-than-expected US inflation data.

According to FXStreet, the US Personal Consumption Expenditures (PCE) Price Index showed annual headline inflation unchanged at 3.4% in August, versus 3.7% expected by markets, and July was revised down to 3.4% from 3.7%. The core PCE measure, which excludes volatile food and energy and is watched by the Federal Reserve, stayed at 3.0% year over year, below a 3.3% forecast, with July revised down to 3.0% from 3.3%.

FXStreet also cited monthly readings showing headline PCE up 0.3% and core PCE up 0.2%. The outlet added that US economic data such as a stronger-than-expected ADP private-sector jobs report supported the dollar broadly, with ADP reporting 90,000 jobs added in September versus a 70,000 estimate.

Latest closeUSD/JPY 157.34 ▼0.1%

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