USD/JPY drops as Fed's Bowman signals July rate cut possibility

USD/JPY has come under selling pressure following dovish comments from Federal Reserve Governor Michelle Bowman, who suggested support for a potential rate cut in July if inflationary pressures remain subdued. The dollar index weakened broadly on these remarks, marking a significant shift in Fed communication as Bowman has historically been one of the more hawkish FOMC members. Her openness to easing monetary policy has reinforced market expectations for Fed rate cuts, with futures markets now pricing in increased probability of a July move. The technical picture shows USD/JPY facing immediate support at key levels as bearish momentum builds. Additional dollar weakness emerged from other unspecified catalysts this week, compounding the pressure on the greenback. Traders are reassessing their dollar-long positions as the prospect of earlier Fed easing gains traction, potentially accelerating the pair's decline if support levels fail to hold.