USD/JPY slips on softer core PCE deflator forecast but remains firm.
【1/26Market Overview
Tokyo time, USD/JPY1month Tokyo Metropolis CPI (excluding fresh food, total) came in below market expectations, causing a temporary rise to147.84yen, but then, due to declines in the US 10-year yield after-hours, it retraced to147.48yen. In European session, European stock markets and the Nikkei futures rose, leading to yen selling and dollar buying. When the US10year yield turned higher, USD/JPY advanced to148.08yen.NYtime,12month US personal consumption expenditures (PCE) price index (deflator) excluding volatile food and energy, the core deflator year-over-year rose to2.9%, below the forecast3.0%. This led to dollar selling and yen buying, with USD/JPY briefly sliding to147.39yen. Subsequently, as US10year yield rose and12month US housing starts index beat expectations, USD/JPY recovered to148.20yen.