Yesterday during Tokyo trading hours, the Bank of Japan’s business survey (Tankan) showed stronger results than expected. This caused people to buy yen, and the USD/JPY dropped from around 144 yen to 143.45 yen. Later, the dollar slightly recovered, but when US long-term interest rates fell in the European session, people continued to sell the dollar. As a result, the USD/JPY fell further to 143.69 yen.
However, during the New York session, strong results came out from the US ISM Manufacturing Index and the JOLTS job data. This changed the mood, and people started buying dollars again, pushing the USD/JPY up to 148.80 yen—a full reversal of earlier losses.
Even though the sharp drop in the dollar has paused for now, the trend of selling the dollar is still continuing. On this day, the US Senate also approved President Trump’s tax cut extension, which increased concerns about the US budget deficit. In addition, Chairman Powell did not rule out a rate cut in July. Because of this, after some short-term dollar buying, the USD/JPY is expected to fall again.
USD/JPY Expected Price Range: 142.70 – 144.10 yen
Note: The information above does not guarantee any profit. Please make your own decisions when trading.