The US Dollar weakened against a basket of currencies and the Japanese Yen amid diminishing expectations for further Federal Reserve rate hikes. According to FX Street, the US Dollar Index traded near 101.40 during early European trading hours on Friday, down from levels around 101.50.
FX Street also noted that the US Dollar has struggled to push above 162.00 against the Japanese Yen for almost a week, reflecting the market's cautious stance. The correction follows easing market expectations for at least two interest rate increases by the Federal Reserve this year.
For Japanese investors and traders, this movement highlights the ongoing sensitivity of the USD/JPY pair to shifts in US monetary policy outlook, which continues to influence cross-border capital flows and risk sentiment in FX markets.