Key events today:

12:30 UTC: USD – Producer Price Index.

The Japanese Yen (JPY) is struggling to attract significant buyers during the Asian session on Friday, with the USD/JPY pair holding just below the highest level since early August, reached the day before. A decline in real wages in Japan for the first time in three months, a drop in household spending, and signs that price pressures from raw material costs are easing have raised doubts about the Bank of Japan’s (BoJ) plans to raise interest rates. This continues to weigh on the Yen ahead of Japan’s snap elections on October 27 and remains a key factor influencing the currency pair.

Meanwhile, the initial market reaction to higher-than-expected US consumer inflation data released on Thursday was short-lived amid signs of labor market weakness. Given that the Federal Reserve (Fed) has shifted its focus to achieving maximum sustainable employment, a sharp rise in jobless claims in the US suggested that the central bank may continue to lower interest rates. This keeps US Dollar (USD) bulls on the defensive, remaining below the nearly two-month high reached the day before, and limits the USD/JPY pair as traders await the release of the US Producer Price Index (PPI).

Recommendations: Trading is primarily advised with Buy orders from the current price level.