USD/JPY: Dollar Whipsaws amid Mixed US Data

The Japanese yen took control over its near-term future as it kept chipping away at the dollar’s dominance.

• The USD/JPY pair continued its steep short-term decline on Friday, just a day after data showed the American economy is still running hot. Applications for unemployment benefits – a proxy for layoffs – fell last week, bucking the trend of a gradually cooling economy.
• Jitters in the greenback ensued, with the Japanese yen initially getting hammered but later putting on a brave face and overpowering the dollar’s dominance. The USD/JPY flipped from Thursday’s peak around ¥134.00 to Friday morning dealmaking at just under ¥133.00.
• Looking into next week, the American dollar, and the broader forex market, are gearing up for the highly-anticipated Federal Reserve meeting. Central bankers are expected to increase rates by 25bps, but with all the chaos in the banking system, some hope it will be a no-rate-hike event.