The USD/JPY pair rose slightly to close to 159.73 during Tuesday’s European trading session. The pair is gaining ground on weaker performance of the Japanese yen (JPY) amid growing concerns over whether the Bank of Japan (BoJ) will raise interest rates in the near future.
Today’s Japanese Yen price
The table below shows the current percentage change of the Japanese Yen (JPY) against the major listed currencies. The Japanese yen was strongest against the Canadian dollar.
| USD | EUR | GBP | JPY | BOOR | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.05% | -0.06% | 0.05% | 0.03% | -0.07% | -0.05% | 0.00% | |
| EUR | 0.05% | -0.01% | 0.09% | 0.07% | -0.01% | 0.01% | 0.05% | |
| GBP | 0.06% | 0.00% | 0.11% | 0.08% | 0.03% | 0.03% | 0.03% | |
| JPY | -0.05% | -0.09% | -0.11% | -0.01% | -0.09% | -0.09% | -0.07% | |
| BOOR | -0.03% | -0.07% | -0.08% | 0.01% | -0.09% | -0.07% | -0.06% | |
| AUD | 0.07% | 0.01% | -0.03% | 0.09% | 0.09% | -0.00% | 0.00% | |
| NZD | 0.05% | -0.01% | -0.03% | 0.09% | 0.07% | 0.00% | 0.00% | |
| CHF | -0.01% | -0.05% | -0.03% | 0.07% | 0.06% | -0.00% | -0.00% |
The heat map shows the percentage changes of the major currencies relative to each other. The base currency is selected from the left column and the quote currency from the top row. For example, if you select Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).
Concerns about the BoJ’s hawkish bets have deepened amid growing economic unrest in the wake of the Middle East crisis.
Last week, former BOJ deputy governor and current member of Japan’s Economic and Fiscal Policy Council Masazumi Wakatabe said it was crucial to understand whether the economy can withstand tighter monetary conditions, Reuters reported.
Meanwhile, fears of Japanese intervention in the forex markets remain unchanged, with the USD/JPY pair approaching previous intervention levels around 160.70. However, Japanese officials consistently avoid mentioning any key Forex levels.
At the time of writing, the US Dollar (USD) is trading weakly amid uncertainty around a indefinite peace agreement between the United States (US) and Iran, with the US Dollar Index (DXY) hovering around 99.15.
USD/JPY technical analysis
USD/JPY is slightly higher at around 159.73, maintaining a bullish bias in the brief term as the price holds above the 20-day exponential moving average (EMA) at 158.94. The pair continues to consolidate near recent highs while remaining supported by this lively support, and the 14-day relative strength index (RSI) of around 60 suggests constructive but not yet overbought momentum, leaving room for further gains as long as the pair defends its underlying low.
On the other hand, immediate support is located at the 20-day EMA around 158.94, where a sustained break would indicate a deeper corrective phase towards 158.00. Looking up, the pair looks to return to its near two-year high of 160.74.
(The technical analysis for this story was written with the aid of an AI tool.)
Frequently asked questions about the Bank of Japan
The Bank of Japan (BoJ) is Japan’s central bank that sets the country’s monetary policy. Its mandate is to issue banknotes and exercise currency and monetary control to ensure price stability, which means an inflation target of around 2%.
The Bank of Japan began ultra-loose monetary policy in 2013 to stimulate the economy and generate inflation in a low-inflation environment. The bank’s policy is based on quantitative and qualitative easing (QQE), which is printing banknotes to buy assets such as government or corporate bonds to provide liquidity. In 2016, the bank doubled down on its strategy and further loosened its policy, first introducing negative interest rates and then directly controlling the yield on 10-year Treasury bonds. In March 2024, the BoJ raised interest rates, effectively withdrawing from its ultra-loose monetary policy stance.
The Bank’s massive stimulus caused the yen to depreciate against other major currencies. This process intensified in 2022 and 2023 as policy divergences widened between the Bank of Japan and other major central banks, which decided to sharply raise interest rates to combat decades-long levels of inflation. The BoJ’s policy led to a deepening differential against other currencies, which resulted in a decline in the value of the yen. This trend was partially reversed in 2024, when the BoJ decided to abandon its ultra-loose policy stance.
A weaker yen and a edged raise in global energy prices led to a rise in inflation in Japan, which exceeded the BoJ’s target of 2%. The prospect of rising wages in the country – a key element driving inflation – also contributed to this move.
