Forex News: Yen Slides Amid BoJ Rate Hike Uncertainty

Yen Slides Amid BoJ Rate Hike Uncertainty

(RTTNews) - The Japanese yen weakened against other major currencies in the European session on Tuesday, due to the uncertainties surrounding the probable timing of the Bank of Japan's (BoJ) next interest rate hike.

Traders also cautiously look ahead to upcoming U.S. monthly jobs and inflation data, along with the US Fed's rate decision.

U.S. appeals court ruled late Friday that most of President Donald Trump's tariffs are illegal, dealing a big blow to his trade agenda.

As the legal battel rages over tariffs, Investors now look forward to the latest jobs numbers, inflation data and the Federal Reserve's rate call for directional cues.

Economists currently estimate that nonfarm payrolls will come in at 74,000 in August, not far from the mark of 73,000 in July.

Questions over the Fed's independence remain, with ECB chief Christine Lagarde warning that if Trump were to undermine the independence of the Federal Reserve, it would represent a "very serious danger" to the global economy.

In Europe, French Prime Minister Francois Bayrou has declared that the "fate of France" is on the line in a confidence vote scheduled for September 8, 2025.

As war rages on in Ukraine, U.S. Treasury Secretary Scott Bessent said that all options were on the table regarding sanctions on Russia for its continued war in the country.

The Trump administration has approved the sale of 3,350 Extended Range Attack Munitions (ERAM) missiles to Ukraine, providing a potentially powerful tool to Kyiv as it continues to face a relentless assault by Russia.

Kremlin foreign policy adviser Yuri Ushakov said that there are no concrete plans for a trilateral meeting between the presidents of Russia, Ukraine and the U.S, contradicting Trump's words about what was agreed at the Alaska meeting.

In the European trading today, the yen fell to more than 1-month lows of 173.29 against the euro and 184.84 against the Swiss franc, from early highs of 172.31 and 183.74, respectively. If the yen extends its downtrend, it is likely to find support around 175.00 against the euro, 186.00 against the franc,

Against the pound and the U.S. dollar, the yen slid to more than a 2-week low of 200.27 and nearly a 2-week low of 148.28 from early highs of 199.26 and 147.09, respectively. The yen is likely to find support around 202.00 against the pound and 150.00 against the greenback.

Against Australia, the New Zealand and the Canadian dollars, the yen dropped to more than a 1-month low of 96.87, nearly a 2-week low of 87.17 and a 3-week low of 107.80 from early highs of 96.45, 86.85 and 106.99, respectively. On the downside, 98.00 against the aussie, 88.00 against the kiwi and 109.00 against the loonie are seen as the next support levels for the yen.

Looking ahead, U.S. and Canada S&P Global manufacturing PMI reports for August, U.S. construction spending for July and U.S. RCM/TIPP economic optimism index for September are slated for release in the New York session.

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