USD/JPY declines to near 146.00 on BoJ’s hawkish Summary of Opinions

• USD/JPY drops to near 146.00 as Yen strengthens after BoJ’s hawkish Summary of Opinions.
• After global market mayhem, BoJ Uchida preferred to keep the interest rates on hold until markets stabilized.
• The US Dollar will be influenced by the weekly US jobless claims data.

The USD/JPY falls to near 146.00 in Thursday’s European session. The asset weakens as the Japanese Yen (JPY) strengthens after the release of the Bank of Japan’s (BoJ) Summary of Opinions (SoP), which indicated that officials acknowledged the need of more rate hikes, in the July 30-31 meeting, to tame inflationary pressures, driven by higher import prices.

However, the impact of hawkish BoJ’s SOP is expected to be short-lived as the global risk-aversion mood could force officials to pause the policy-tightening spell. Sheer volatility in Japan’s equity markets due to BoJ’s withdrawal of accommodating policy stance has impacted BoJ’s rate-hike prospects.

On Wednesday, BoJ Deputy Governor Shinichi Uchida said, “We won’t raise rates when markets are unstable,” according to Reuters.

Meanwhile, the asset remains in a negative trajectory even though the US Dollar (USD) has recovered its intraday losses. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, hovers around 103.00.

The US Dollar is expected to remain under pressure on firm expectations that the Federal Reserve (Fed) will deliver fat rate cuts.

Going forward, investors will keenly on United States (US) Initial Jobless Claims due to an absence of top-tier economic data, which will be published at 12:30 GMT. Economists have estimated that individuals claiming jobless benefits for the first time were 240K, lower than the prior release of 249K, for the week ending August 2.