USD/JPY offered post dovish FOMC minutes

By FXStreet USD/JPY has dropped on the FOMC minutes that although painted an uncertain picture, Yellen has spoken about much of the concerns recently when she testified, so there wss not anything new in the minutes that markets had not already priced in.

The minutes explained oil, China, the dollar and financial markets in the context of a still strong labour market are a risk. Falling oil prices will keep inflation in check, but lower energy to consumers could offset the negative impact. The US dollar weighing on the manufacturing sector.

Financial markets main concern

Financial markets were the biggest concern of all. Tighter financial conditions are pushing up market volatility and creating downside risks to the economy. However, the economy is stronger than markets are suggesting. Monetary policy is data dependent.

Oil is the one to watch

Meanwhile, oil has been driving USD/JPY of late as risk is strongly correlated to the price action and news in the sector.

There was conflicting news on oil today driving the price back and forth, but the Iranian oil minister gave the commodity a boost later in the session and sees the price back above $30 bbl, supporting USD/JPY.

USD/JPY levels

USD/JPY felt headwinds at the …read more

Source:: FX Street