USDJPY: SELL 144.60, SL 145.00, TP 143.60 | 27 June 2025

An event to watch out for today:

15:30 EET. USD - Gross Domestic Product

USDJPY:

The Japanese yen (JPY) is regaining positive momentum amid the general weakening of the US dollar (USD), causing the USD/JPY pair to fall below the psychological mark of 145.00 during Thursday's Asian session. Despite its indecision on raising interest rates, the Bank of Japan (BoJ) is still expected to stick to its course of normalizing monetary policy, as inflation continues to exceed the target level. In contrast, the latest forecasts and dot plot from the Federal Reserve (Fed) suggest two rate cuts before the end of the year, which is significantly at odds with the expectations of the BoJ, which is sticking to its hawkish policy. This is seen as a key factor favoring the Japanese yen with lower yields.

Meanwhile, US President Donald Trump's new threat that he is considering replacing Fed Chairman Jerome Powell is heightening concerns about the central bank's independence. This is overshadowing recent optimism about a truce between Israel and Iran and reducing investor appetite for risky assets, further strengthening the yen's status as a safe haven. In addition, the confrontation between Trump and Powell is pulling the US dollar to its lowest level since March 2022 and contributing to the decline in the USD/JPY pair. Traders are now waiting for final US GDP data for the first quarter to gain momentum ahead of the release of key inflation data in Japan and the US on Friday.

Trading recommendation: SELL 144.60, SL 145.00, TP 143.60

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