Ella 
In early Asian trading on Thursday, USD/JPY fell from around 153.24, the highest level since July 1990, and then weakened around 153.00. Improved U.S. consumer price index (CPI) data for March prompted investors to scale back their bets on U.S. interest rate cuts this year, providing support for the rise in USD/JPY.
U.S. inflation rose higher than expected in March. Headline inflation rose 0.4% monthly in March, compared with expectations for a 0.3% rise. Data from the U.S. Labor Department on Wednesday showed inflation at an annual rate of 3.5%, compared with expectations for a 3.4% gain.
Excluding the volatile food and energy components, core inflation was 0.4% monthly in March, compared with expectations for a 0.3% increase. Growth was 3.8% on an annual basis, compared with expectations for growth of 3.7%. After the U.S. inflation data was released, the Chicago Mercantile Exchange’s FedWatch Tool showed that investors’ bets on the Federal Reserve (Fed) to cut interest rates in June dropped to 17% from 57% before the data was released.
In addition, the minutes of the Fed’s last meeting showed that participants were worried about continued high inflation, and recent data did not help the Fed’s confidence that inflation will continue to move towards the 2% target. USD/JPY was a “boost” for the USD/JPY currency pair as officials stressed the need to keep interest rates higher for longer.
