USD/JPY gets trashed as Fed alters course

The markets were certainly taken aback last night by the US Federal Reserve and its boss Jerome Powell. First the Fed tweaked its dot plot plan to indicate a much earlier time when it might start to cut interest rates and then Powell added to that by telling the markets the Fed was done and would have to cut much sooner than many analysts expected, in order to avoid an overshoot. This sent US stocks into a frenzy, as yields sank and that did for the US dollar. The USD/JPY, which had touched 146 earlier in the day, sank to as low as 142.65 ahead of the close, at 142.89. However, it was not finished there, because earlier today the dollar took out the previous interim low at 141.71 and that seemed to trip more stops on route to a new low at 140.97. It has rebounded from there now, but as to whether it can maintain that rebound is another matter. The USD/JPY is currently trading at 141.75