Market News

Summary

• BOJ revises up inflation forecasts; yen strengthens slightly
• Dollar buoyant with year's first monthly gain in sight
• Fed reiterates patient approach on rates
• South Korea to face 15% US tariffs, more trade deals awaited

NEW YORK/LONDON, July 31 (Reuters) - The U.S. dollar was headed for its first monthly gain for 2025 against major currencies on Thursday, underpinned by easing trade tensions and U.S. economic resilience.
The dollar rose against the yen , trading at its highest level since May 28. It is on track to gain about 5% for July, making it the biggest monthly increase since December 2024. It was last up 0.83% at 150.765.

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In a widely expected move, the Bank of Japan on Thursday kept short-term interest rates steady at 0.5% by a unanimous vote, but revised up its inflation forecasts for the next few years.

That came after the Federal Reserve left U.S. interest rates unchanged on Wednesday, ignoring persistent calls by President Donald Trump to lower borrowing costs. Fed Chair Jerome Powell also indicated he was in no rush to cut rates.
The greenback has been bolstered by a hawkish Fed and U.S. economic resilience, with uncertainty over Trump's chaotic tariffs easing after an array of trade deals.
The dollar index was up 0.16% at 99.949 after rising nearly 1% in the previous session. It is on track for the first monthly gain in 2025.
"There's been a clash and a friction between what the Fed is seeing and deciding to do, and what the White House and perhaps a lot of people in the equity market want the Fed to do," said Juan Perez, director of trading of Monex USA in Washington.