- Since the beginning of this week’s trading, amid cautious anticipation of the markets until the announcement of US inflation figures tomorrow, Thursday.
- The price of the USD/JPY currency pair has moved in a narrow range, with a bearish tendency, between the 131.30 support level and the level of 132.58, which is stable near it at the time of writing the analysis.
- Until now, the US dollar is still affected by the recent US job numbers, which may weaken the US central bank's appetite for further tightening of its policy.
And this week we noticed a flood of statements by policy members of the US Federal Reserve. Yesterday, Jamie Dimon said that the Fed's interest rate increases may need to exceed what is currently expected, but he supports a pause to see the full impact of last year's increases. The CEO of JPMorgan Chase & Co. said there is a 50% chance that the current forecast is correct in assuming the Fed will raise the benchmark interest rate to around 5%, and a 50% chance that the central bank will head to 6%. "I'm in for that may not be enough," Damon added. And “we were a little slow caught. I don't think there's any harm in waiting three or six months."
The CEO of the largest US bank made his comments ahead of US inflation data due on Thursday and fourth-quarter results from major banks that start on Friday. Prior to that, Fed officials slowed the rate hike last month and raised borrowing costs by 50 basis points after four consecutive increases of 75 basis points. The target reference rate is between 4.25% and 4.5%.
The wide-ranging interview took place Monday at JPMorgan's annual healthcare investment banking conference in San Francisco — the first time it has been held in person since before the pandemic. An advocate for employees coming into the office, Dimon said about 60% of JPMorgan's workforce is full-time and "about the rest" are there half-time.
On the US economy, Dimon echoed comments he made over most of the past year, saying that while the consumer is still strong, increased risks remain. He pointed to the impact of Russia's invasion of Ukraine and quantitative tightening. He added that while peers including Goldman Sachs Group and Morgan Stanley are laying off employees, JPMorgan is "still in hiring mode," adding that he understands why companies are being cautious. He added that wage pressure has eased slightly with lower levels of attrition.
USD/JPY Forecast:
There is no change in my technical view of the performance of the USD/JPY currency pair, as the general trend still tends to fall so far, and a break of the bearish trend will not occur without breaching the 135.74 resistance level. On the other hand, according to the performance on the daily time frame chart below, the move will be at the 131.30 support level, which is important for the continuation of the bearish trend. The currency pair may remain in its current range until the US inflation figures are released on Thursday. I still prefer to buy USD/JPY from every downside level.
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