• USD/JPY retreats despite the rise in US Treasury bond yields and growing market confidence ahead of the Fed’s decision.
• A boost in US consumer confidence to a two-year high fails to steady USD/JPY as concerns about a potential recession persist.
• Projections from Japan’s Cabinet Office for modest inflation and GDP growth for 2023 and 2024 add further complexity to the currency’s trajectory.

USD/JPY retreats from weekly highs of 141.81 and falls toward current exchange rates amid a risk-on impulse, although US Treasury bond yields are rising. Traders brace for the US Federal Reserve (Fed) July meeting, which starts today and ends tomorrow, followed by the Fed Chair Jerome Powell press conference. At the time of writing, the USD/JPY exchanges hand at 141.05.