USD/JPY falls on Fed statement

• The FOMC was much less hawkish than expected and investors dumped the USD on the news. The Fed did not mention a rate hike in June.
• USD/JPY fell after flirting with 110.00 but bears will need a lot of work to reverse the current bullish trend.
• Coming up on Friday is the US Non-Farm Payroll which can stir the market.

The USD/JPY is trading at around 109.73 down 0.13% on Wednesday as the Fed surprised the market with its less hawkish-than-expected statement.

The Fed left interest rates unchanged as expected. However, there was no hint towards a rate hike in June.The US Dollar dropped on the news because there were a few changes to the statement, like the word “symmetric” referring to the inflation target. This is seen as allowing inflation to run higher before hiking.On the negative side, referring the economy the Fed used the word “moderate” and the improved outlook is nowhere to be found. Some analysts argue that the US dollar fell on the back of profits taking. 

The USD/JPY is still on a steep bull trend and it will take bears a lot of strength to reverse it. Friday, the US Non-Farm Payroll will be released. A lot of volatility is likely expected before the end of the week.