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USD/JPY corrects to near 144.50 as US Dollar retraces ahead of US NFP data

- USD/JPY retraces to near 144.50 as the US Dollar gives up the previous day’s gains ahead of the US NFP data for April. - Easing US-China trade tensions have increased the risk appetite of investors. - BoJ Ueda signaled that plans of monetary policy tightening have been swayed by Trump’s tariff policy. The USD/JPY pair faces selling pressure after a three-day recovery move around 146.00, earlier in the day, and corrects to near 144.50 during European trading hours on Friday. The pair retraces as the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, gives up Thursday’s gains and slides to near 99.65. The US Dollar (USD) surrenders previous day’s gains as investors turn cautious ahead of the United States (US) Nonfarm Payrolls (NFP) data for April, which will be published at 12:30 GMT. The economic data is expected to have been severely impacted by US President Donald Trump’s tariff agenda. Economists expect US employers to have hired 130K fresh workers, significantly lower than the March reading of 228K. The Unemployment Rate is seen as steady at 4.2%. Signs of cooling labor market conditions would strengthen market expectations that the Federal Reserve (Fed) would start reducing interest rates from the June policy meeting. Meanwhile, market sentiment has turned favorable for risky assets on hopes of a de-escalation in the trade war between the US and China. The Chinese Commerce Ministry signaled willingness to come to the table for trade discussions with the US with the stipulation that talks should be based on “sincerity”. Though the Japanese Yen (JPY) is up against the US Dollar on Friday, its outlook has become uncertain as the Bank of Japan (BoJ) has signaled a delay in plans to increase interest rates further in the face of tariffs announced by US President Trump. “We will enter a period in which both inflation and wage growth will likely slow somewhat,” BoJ Governor Kazuo Ueda said in the press conference, Reuters reported.

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Publication date:

2025-05-02 11:35:29 (GMT)

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