USD/JPY Attracts Some Sellers Below 156.50 As Yen Strengthens On Intervention Fears

Image Source: PixabayThe USD/JPY pair tumbles to around 156.30 during the early Asian session on Wednesday. The US Dollar (USD) weakens against the Japanese Yen (JPY) despite the stronger-than-expected US Gross Domestic Product (GDP) report for the third quarter (Q3). Financial markets are likely to trade in a subdued mood ahead of the Christmas holiday. The US weekly Initial Jobless Claims are due later on Wednesday. Data released by the Bureau of Economic Analysis on Tuesday, showing strong growth in the world's largest economy, failed to shift sentiment from expectations of Federal Reserve (Fed) interest rate cuts next year. The US economy expanded at a 4.3% annualized pace in Q3. This figure was higher than the 3.3% expected and followed a 3.8% growth in Q2. The Greenback remains weak against the JPY in an immediate reaction to the upbeat GDP data. Additionally, verbal intervention from Japanese officials could provide some support to the Japanese Yen and create a headwind for the pair. Japan’s Finance Minister Satsuki Katayama said on Tuesday that the official has a free hand in dealing with excessive moves in the JPY. Earlier on Monday, Japan’s top foreign exchange (FX) official, Atsushi Mimura, stated that recent foreign exchange moves were one-sided and sharp. Mimura added that he is concerned about the FX move and that the government will take appropriate action against excessive actions.Despite the Bank of Japan’s (BoJ) recent rate hike, the Japanese central bank has refrained from providing explicit forward guidance regarding the timing of future movements. BoJ Governor Kazuo Ueda said during the press conference that Japan's economy is recovering moderately, albeit with some weakness.Ueda further stated that the central bank will closely monitor the impact of the latest rate change, and the pace of monetary adjustment will depend on the economic, price, and financial outlook. The uncertainty surrounding the future BoJ interest rate path could undermine the JPY against the USD. More By This Author:Gold Extends Rally To Record High As Safe-Haven Demand Builds Gold Edges Lower Despite Fed Rate Cut Hopes On Cooling US Inflation WTI Edges Lower Below $56.50 On US Dollar Strength, Weak China Demand