FxWirePro: USD/JPY uptrend loses steam, remains on

USD/JPY edged lower as the yen firmed as softer-than-expected US inflation data eased concerns about imminent Federal Reserve interest rate hikes. Softer-than-expected U.S. producer inflation in June reinforced the...

• USD/JPY edged lower as the yen firmed as softer-than-expected US inflation data eased concerns about imminent Federal Reserve interest rate hikes. • Softer-than-expected U.S. producer inflation in June reinforced the previous day's benign CPI data, prompting markets to cut the odds of a Fed rate hike this month to 10% from 43% earlier.

• Japan's Finance Minister Satsuki Katayama said higher growth potential resulting from government policy shifts could prompt a review of state pension fund asset allocations. • Katayama told parliament that the Government Pension Investment Fund (GPIF) reviews its portfolio and asset allocation each fiscal year in an appropriate and timely manner.

• Katayama's remarks last week about encouraging pension funds, including the GPIF, to invest more in local assets sent the yen and Japanese government bonds higher. • Immediate resistance is located at 162.74 (23.6%fib), any close above will push the pair towards 163.15(Higher BB).

• Support is seen at 162.08(SMA20) and break below could take the pair towards 160.80(38.2%fib). Recommendation: Good to buy around 162.00, with stop loss of 161.50 and target price of 162.70

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