USD/JPY Slides 0.1% to 144.67 as Dollar Index Retreats Below 100 USD/JPY Slides 0.1% to 144.67 as Dollar Index Retreats Below 100

• USD/JPY fell back to 144.67 after its initial rally above 146 on Thursday.
• The US Dollar Index slipped from the 100 mark.
• Japan’s Economy Minister Akazawa confirmed plans to proceed with trade talks despite the US Court of International Trade’s tariff ruling.

USD/JPY Weakens Following Trade-Fueled Rally

The USD/JPY currency surged in the early hours of Thursday’s trading session by climbing to around 146.26. The pair lost its momentum, however, and a 0.1% drop saw its exchange rate hit 144.67. The reversal coincided with renewed doubts over the stability of US trade policy following a court decision that struck down President Donald Trump’s tariff framework.

As news spread that a US court challenged the legitimacy of Trump’s tariff orders, the US Dollar Index first mirrored the USD/JPY’s ascent and rose above the 100 threshold. These gains were erased later in the day, with the index falling 0.04% to 99.832.

Tariff Uncertainty Clouds Trade Stability

On Wednesday, the US Court of International Trade determined that Trump had exceeded his presidential mandate when invoking the International Emergency Economic Powers Act (IEEPA) to implement his tariff strategy. The court argued that the use of a national emergency rationale to address persistent trade deficits violated constitutional boundaries.

The ruling triggered a broad market rally across various assets, but enthusiasm waned to an extent as uncertainty among businesses grew. Moreover, the Trump administration made the decision to appeal the ruling.

Japan Presses Ahead with Trade Talks

With trade relations in question, investors are turning their attention to whether the US administration will stay committed to negotiating agreements with global partners.

Despite the political and legal backdrop, Japanese Minister in charge of Economic Revitalization Ryosei Akazawa announced that he would move forward with a planned trip to Washington to negotiate trade relations. As reported by Bloomberg, Akazawa acknowledged that the US court ruling provided no further statements on how it could affect tariff talks. He did stress, however, that Japanese officials will “thoroughly examine the content of the ruling and its implications and respond appropriately.”