- The Japanese yen continues to lose the earth because the mood undermines safe armed assets.
- The US dollar stands near a multiple week -long touched increase and also provides support to the US dollar/JPY.
- BoJ’s different expectations guarantee caution before any other JPY losses.
Japanese yen is drifting to its American counterpart for the fourth consecutive day, which prompted the pair of the dollar/JPY to the 151.00 neighborhood, or a three -week summit during the Asian session on Tuesday. The global risk feeling is still well -supported in the hope that the mutual definitions called US President Donald Trump will be narrower and less strict than he was initially afraid. In addition, optimism about a possible peace agreement for Russia or Ukraine and it is reported that China is studying the inclusion of services in the support program to stimulate consumption increased investor confidence, which undermines safe armed JPY.
Meanwhile, the minutes of the Boj Bank meeting in January showed that policymakers who were discussed under the conditions that the central bank must raise interest rates. However, the minutes did not provide any evidence about the potential time of the next BOJ step and did not do much to persuade JPY. However, BOJ Falcons’ expectations are still a major difference compared to Federal Reserve’s expectations (Fed) of the two of 25 basis points by the end of this year. This bulls may prevent the US dollar from putting aggressive bets and support to a low -yield JPY, which must gain Cap for a USD/JPY husband.
The Japanese yen is undermined by declining demand for safe calm; Blins to raise interest rates help reduce the negative aspect
- On Sunday, reports indicated that US President Donald Trump is planning a narrower and more targeted business schedule of mutual definitions that are scheduled to enter April 2, providing less sabotage definitions and pampering risk morale.
- The talks between the United States and Russian waste were concluded on Monday, and the discussion focused on trying to reach the black ceasefire deal. According to the Russian government media, Raya, a joint statement is expected on Tuesday.
- Financial Times reports that China is considering including services in the support program of millions of dollars to stimulate consumption, which increases investor confidence and driving flows away from the safe Japanese yen.
- The US dollar rose to the highest level in almost three weeks on Monday, in response to the best version of the US Participants Index-which rose to 53.5 in March from 51.6 in the previous month-and provides support to the dollar pair/JPY.
- The Boj Bank’s minutes showed the last meeting of the policy held in January that most members agreed to the possibility of obtaining the purpose of inflation by 2 %. Moreover, politicians discussed the pace of interest rates further.
- Meanwhile, the governor of Boj Kazuo Ueda said in Parliament on Monday that the purpose of our policy is to achieve stable prices and that the central bank will adjust the degree of cash dilution if it is likely to achieve the goal of inflation by 2 %.
- This comes in addition to the increasing acceptance that the growth of the strongest wages can contribute to the escalation of local prices and keep the door open to more interest rates by BOJ, which would help reduce losses in JPY.
- In contrast, the Federal Reserve indicated last week that it is likely to provide discounts in the 25 points prices by the end of 2025. However, traders seek the possibility of interest rate cuts in the three -point category in June, July and October.
- The head of the Federal Reserve at Atlanta Rafael Postic said on Monday that he expects a slower progress in inflation in the coming months and believes that the standard interest rate of the Central Bank reduces only a quarter of a percentage point by the end of this year.
- On Tuesday, the US economic Dockty is characterized by the issuance of the Consumer confidence index in the Conference Council, the sales of new homes, and the Richmond Industrialization Index. This, along with Fed Speal, can affect the dynamics of dollar price.
- However, the focus will continue to be attached to the preferred inflation scale of the Federal Reserve-the PC PC Prices for Personal Consumption (PCE) on Friday, which will increase the market expectations about the future interest rate path.
USD/JPY can aim to exceed a mark of 151.00 and re -test monthly oscillation, about 151.30 regions
From a technical perspective, the collapse was seen overnight over the psychological mark 150.00 and a subsequent step that exceeded the swing last week, around the 150.15 region, as a major operator of the upscale merchants. Moreover, the oscillator on the daily chart gained a positive traction and in support of the further move to the pair of the dollar/JPY. Thus, some follow -up force after the round shape 151.00, towards a high monthly swing test around the 151.30 region, looks like a distinctive possibility.
On the other hand, any corrective withdrawal may now attract new buyers near the 150.15 area, which should help reduce the negative side near the 150.00 sign. However, a convincing break below the latter can pull the pair of the dollar/JPY to 149.30-149.25 medium support on the way to the round shape 149.00 and the horizontal area 148.70-148.65. The failure to defend the aforementioned support levels will indicate that the recent recovery from the lowest multi -month level has run out of steam and changes prejudice in the near term in favor of the declining traders.
Japanese questions yen
The Japanese yen (JPY) is one of the most trading currencies in the world. Its value is widely determined by the performance of the Japanese economy, but more specifically through the policy of the Bank of Japan, and the differential between the revenues of Japanese and American bonds, or risk morale among merchants, among other factors.
One of the states of the Bank of Japan is the control of the currency, so its movements are the key to the yen. BOJ interfered directly in the currency markets sometimes, and generally to reduce the value of the yen, although it refrains from doing so often due to the political concerns of its main commercial partners. Boj Ultra-LOOSE’s monetary policy between 2013 and 2024 caused the yen to decrease against its main peers due to the difference in policy between the Bank of Japan and other major central banks. Recently, relaxation has gradually gave this super -support policy some support for the yen.
Over the past decade, the BoJ’s position of adhering to a high -minded monetary policy has has expanded a difference in politics with other central banks, especially with the American Federal Reserve. This is to support the expansion of the difference between American and Japanese bonds for a period of 10 years, which preferred the US dollar against the Japanese yen. BOJ’s decision in 2024 to gradually abandon the policy of the super taste, as well as discounts in the interest rate in other major central banks, narrows this difference.
The Japanese yen is often seen as a safe investment. This means that in times of stress on the market, investors are likely to put their money in the Japanese currency because of its reliability and supposed stability. Distinguished times are likely to enhance the value of the yen against other currencies that are seen as more dangerous for investment.
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