• USD/JPY weakens to 145.35 in Wednesday’s Asian session. 
• Higher expectations of a Fed rate cut in September undermine the USD. 
• The advanced US August S&P Global PMI will be due on Wednesday ahead of Fed Chair Powell’s speech.

The USD/JPY pair trades in negative territory near 145.35 for four consecutive days during the early Asian session on Wednesday. The softer US Dollar (USD) and expectation of a dovish message from Federal Reserve (Fed) Chair Jerome Powell at Jackson Hole drag the pair lower. 

Investors are confident that the US Fed will cut interest rates this year, expecting three quarter-point Fed cuts in September, November and December. This, in turn, exerts some selling pressure on the Greenback. Some officials said a half-point Fed rate cut in September could not be ruled out if there were signs of a further slowdown in hiring.

Minneapolis Fed President Neel Kashkari said on Monday he would be open to cutting US interest rates in September because of the rising possibility that the labor market weakens too much. “The balance of risks has shifted, so the debate about potentially cutting rates in September is an appropriate one to have,” said Kashkari.