#PowellRemarks

The Japanese Yen (JPY) has extended its advance against the US Dollar (USD) following the Federal Reserve’s policy decision, as traders shift focus to remarks from Fed Chair Jerome Powell.

USD/JPY dropped sharply after the announcement and is now trading around 144.50, down 0.45% on the day, as bond yields declined and rate-cut expectations firmed.

As expected, the Fed left interest rates unchanged at 4.25%–4.50%, with a unanimous decision. Policymakers cited persistent uncertainty surrounding fiscal policy, tariffs, and tax measures, making it difficult to offer clear forward guidance.

Markets interpreted the update as dovish. Treasury yields fell, with the 2-year note dropping nearly 5 basis points to 3.9%. The updated dot plot signals two rate cuts by the end of 2025, unchanged from the March forecast. Seven FOMC members expect two cuts, while four anticipate just one.