USDJPY appreciates towards 157.5 ahead of US CPI release

Japanese yen is depreciating further against the US dollar today (-0.15% - 1-day relative performance).
 

The USDJPY currency pair is trading above key simple moving averages (21-, 50- and 100-period SMAs), underscoring a strong uptrend.

The relative strength index (RSI) is in the neutral zone (<30 – oversold; >70 – overbought), highlighting the market’s current state of uncertainty as investors are getting ready for the BoJ’s interest rate decision, scheduled to be carried out this Friday, June 14.
 

Bak of Japan interest rate hike may potentially drag the USDJPY down towards its key support levels at 21- and/or 50-period SMAs.

In the near-term the USDJPY pair may be affected by the US CPI reading along with FED policy meeting and a subsequent press conference (Wednesday, June 12).

• US CPI MoM: 0.1% - expected; 0.3% - previous
• Fed key rate decision: 5.5% - expected

A stronger-than-expected CPI report or/and hawkish Fed commentary, hinting on the higher-for-longer rates, may result in USD appreciation against Japanese yen.

According to the CME FedWatch Tool, the markets imply a 57.9% probability (77.8% - 1 week ago) for the interest rate cuts in September 2024.