USD/JPY falls from 160.00 in Wednesday's Asian trading hours, retreating from monthly highs as bulls pause amid fears that Japanese authorities will step in again to prop up the domestic currency. However, a lack of clarity on the US-Iran peace talks keeps the US Dollar's reserve-currency status intact amid hawkish Fed bets, limiting the pair's downside.
The USD/JPY pair enters a bullish consolidation phase on Wednesday, oscillating in a narrow range just below the 160.00 psychological mark, or a one-month high touched during the Asian session. Verbal intervention by Japan’s Finance Minister Satsuki Katayama offers some support to the Japanese Yen (JPY), which, along with a subdued US Dollar (USD) price action, caps spot prices.
However, economic concerns stemming from the conflict in the Middle East and the effective closure of the Strait of Hormuz hold back the JPY bulls from placing aggressive bets. In contrast, the lack of breakthrough in US-Iran peace negotiations, along with hawkish US Federal Reserve (Fed), acts as a tailwind for the safe-haven US Dollar (USD) and helps limit downside for the USD/JPY pair.