USDJPY recovered after falling significantly earlier in the month
At the beginning of January, the Japanese Yen strengthened significantly against the USD, but later it reached stability. The current quote for the instrument is 108.87.
The beginning of January was quite efficient for the Yen. Due to “great escape” of investors from risks, their interest in “safe haven” assets increased and the Yen was on the top of this list. A bit later, panic on the market subsided and the Yen had an opportunity for a correction.
However, one can’t say that either the Yen is retreating or the USD is recovering a lot. Investors are still analyzing what the FOMC Chairman Jerome Powell said last Friday. He told the media about possible changes in the regulator’s monetary policy depending on the inflation and signals from the economy. It’s good that the US Federal Reserve chooses to be flexible, but in this case investors didn’t like possible instabilities in the monetary policy.
The statistics published in the morning indicated that the Consumer Confidence dropped from 42.9 points in November to 42.7 points last month against market expectations of 42.8 points. The indicator is still above the psychologically-crucial level of 50 points separating decline from growth, which means that the Japanese population isn’t ready to spend money more actively than before because they don’t consider economic outlook to be positive.