Japanese Yen adds to intraday gains after BoJ Governor Ueda's comments


  • The Japanese Yen gained positive traction after the BoJ left policy settings unchanged.
  • The uncertainty over further BoJ rate hikes should keep a lid on any further JPY gains.
  • Traders now look forward to the release of the US PCE Price Index for a fresh impetus.

The Japanese Yen (JPY) remains on the front foot against its American counterpart following the Bank of Japan Governor Kazuo Ueda's opening remarks at the post-meeting press conference. Apart from this, a weaker tone around the equity markets turns out to be another factor underpinning the safe-haven demand. This, along with the lack of any meaningful US Dollar (USD) buying, keeps the USD/JPY pair depressed below the 153.00 mark heading into the European session.

Any meaningful JPY appreciation, however, seems elusive in the wake of the uncertainty over the BoJ's rate-hike plans, further fueled by a rare political turmoil after Sunday’s snap election in Japan. Moreover, a further rise in the US Treasury bond yields, bolstered by bets for smaller rate cuts by the Federal Reserve (Fed) and deficit-spending concerns after the US election, should contribute to capping the lower-yielding JPY ahead of the US Personal Consumption Expenditure (PCE) Price Index. 

Daily Digest Market Movers: Japanese Yen builds on the post-BoJ move-up amid subdued USD demand

  • The Bank of Japan decided to leave its monetary policy settings unchanged amid a rare political turmoil after Sunday’s snap election in Japan that snatched the Liberal Democratic Party’s majority for the first time in 15 years.
  • In the accompanying monetary policy statement, the central bank reiterated that it will continue to raise interest rates if the economy and prices move in line with the forecast, which, in turn, provides a modest lift to the Japanese Yen.
  • During the post-meeting press conference, BoJ Governor Kazuo Ueda said that uncertainties surrounding Japan's economy and prices remain high, and keeps a potential interest rate hike move at the December meeting on the table.
  • Government data showed this Thursday that Japan's Industrial Production bounced after declining by 3.3% in August and rose 1.4% in September. The report also revealed that companies expect production to increase by 8.3% in October.
  • A separate government report showed that Retail Sales increased by 0.5% from a year earlier in September, marking a sharp deceleration from the 3.1% rise in the previous month and pointing to a loss of momentum in consumption.
  • The US Dollar attracts some dip-buying and reverses a part of the previous day's modest decline led by mixed economic data, which, in turn, keeps the USD/JPY pair close to its highest level since July 31 touched earlier this week. 
  • The Automatic Data Processing (ADP) reported on Wednesday that private sector employers added 233K new jobs in October, better than the previous month's upwardly revised reading of 159K and surpassing optimistic estimates. 
  • The growth in employment is expected to boost consumer spending and contribute to overall growth, validating the view that the economy remains on strong footing and that the Federal Reserve will proceed with smaller rate cuts.
  • Separately, the US Bureau of Economic Analysis' initial estimate suggested that the world's largest economy expanded by a 2.8% annualized pace during the third quarter, slower than the 3% growth recorded in the previous quarter. 
  • The markets are pricing in the possibility that the Fed will lower borrowing costs by 25 basis points in November, which, along with deficit-spending concerns after the US election, remains supportive of elevated US bond yields.
  • Later during the early North American session, the release of the Personal Consumption Expenditure (PCE) Price Index could provide fresh cues about the Fed's interest rate outlook and influence the USD price dynamics. 

Technical Outlook: USD/JPY could now extend the corrective decline, 152.00 mark holds the key for bulls

From a technical perspective, the recent repeated failures to find acceptance beyond the 61.8% Fibonacci retracement level of the July-September downfall warrant some caution for bulls. Moreover, the Relative Strength Index (RSI) on the daily chart is on the verge of breaking into the overbought zone. This further makes it prudent to wait for some near-term consolidation or a modest pullback before positioning for additional gains. 

Some follow-through selling could drag the USD/JPY pair to the 152.00 mark en route to the 151.45 support and the 151.00 mark. The downward trajectory could extend further towards challenging the 150.65 confluence resistance breakpoint, which should now act as a key pivotal point and a strong base for spot prices.

On the flip side, the 153.85-153.90 region now seems to have emerged as an immediate strong barrier. A sustained strength beyond, leading to a breakout through the 154.00 round-figure mark, has the potential to lift the USD/JPY pair towards the 154.35-154.40 supply zone en route to the 155.00 psychological mark. Spot prices could extend the momentum and eventually climb to test the late-July swing high, around the 155.20 region.

Japanese Yen PRICE Today

The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the Canadian Dollar.

  USD EUR GBP JPY CAD AUD NZD CHF
USD   0.02% -0.06% -0.73% 0.08% -0.05% -0.07% -0.23%
EUR -0.02%   -0.07% -0.76% 0.06% -0.06% -0.10% -0.24%
GBP 0.06% 0.07%   -0.63% 0.13% 0.01% -0.03% -0.17%
JPY 0.73% 0.76% 0.63%   0.81% 0.69% 0.60% 0.50%
CAD -0.08% -0.06% -0.13% -0.81%   -0.11% -0.16% -0.30%
AUD 0.05% 0.06% -0.01% -0.69% 0.11%   -0.04% -0.21%
NZD 0.07% 0.10% 0.03% -0.60% 0.16% 0.04%   -0.14%
CHF 0.23% 0.24% 0.17% -0.50% 0.30% 0.21% 0.14%  

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the 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).

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

EUR/USD holds above 1.0850 after EU inflation data

EUR/USD holds above 1.0850 after EU inflation data

EUR/USD trades marginally higher on the day above 1.0850 in the European session on Thursday. The data from the Eurozone showed that the annual HICP inflation rose to 2% in October from 1.7% in September, helping the Euro hold its ground.

EUR/USD News
USD/JPY falls below 152.50 as markets assess BoJ policy decisions

USD/JPY falls below 152.50 as markets assess BoJ policy decisions

USD/JPY stays under bearish pressure and trades below 152.50 on Thursday. The Bank of Japan (BoJ) left its policy setting unchanged but Governor Ueda noted that the impact of foreign exchange rate on prices had become larger than in the past.

USD/JPY News
Gold holds near $2,780, looks to US PCE Price Index for fresh impetus

Gold holds near $2,780, looks to US PCE Price Index for fresh impetus

Gold stays in a consolidation phase after setting a new record-high of $2,790. US political jitters and Middle East tensions might continue to act as a tailwind for the XAU/USD. Traders keenly await the release of the US PCE Price Index before placing fresh directional bets.

Gold News
Uniswap Price Forecast: Technical outlook suggests a bullish breakout ahead

Uniswap Price Forecast: Technical outlook suggests a bullish breakout ahead

Uniswap is trading slightly below $8 on Thursday after rejecting a key resistance level on Wednesday. A successful close above this threshold could indicate a rally for the decentralized exchange, bolstered by technical indicators showing a bullish crossover pointing to potential upward momentum.

Read more
German economy surprises in the third quarter

German economy surprises in the third quarter

The German economy avoided a technical recession in the third quarter, showing unexpected growth. However, this does not change the fact that the economy remains stuck in stagnation.

Read more
Best Forex Brokers with Low Spreads

Best Forex Brokers with Low Spreads

VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.

Read More

Forex MAJORS

Cryptocurrencies

Signatures