In the Bank of Japan’s report, the forecast for 2025 inflation was raised a lot. This caused the dollar/yen to fall to 148.60. However, BOJ Governor Ueda said policy will not change just because of inflation forecasts. This made people think the BOJ will not raise interest rates soon, and the yen weakened.
In the European market, the dollar/yen moved above the 200-day moving average near the high 140 yen range, which was seen as a strong resistance level.
Later, in the New York market, U.S. data (PCE inflation and employment cost index) was stronger than expected. This made the dollar stronger and many investors closed their yen buy positions. As a result, the dollar/yen went up to 150.83.
In one month, the dollar/yen rose over 8 yen. This is because people believe the gap between U.S. and Japanese interest rates may not grow further.
However, if the yen becomes too weak, it may cause prices to rise in Japan and increase exports. This could cause pressure from the U.S. and may push the BOJ to raise interest rates sooner. So, the dollar/yen may be close to its upper limit.
USD/JPY Price Range Forecast: 150.00 – 151.60 yen
Note: This information does not guarantee profits. Please make your own decisions when trading.