USDJPY: BUY 150.30, SL 149.70, TP 151.30 | 21 Febrero 2025

An event to watch out for today:

16:45 EET. USD - Composite PMI

USDJPY:

The Japanese Yen (JPY) attracted some sellers on Friday in response to comments from Japanese Finance Minister Katsunobu Kato, who said that a hike in long-term rates could put pressure on Japan's financial situation. This helped the USD/JPY pair make a modest rebound from the 149.30-149.25 area, the lowest level since December 3, reached during the Asian session. Nevertheless, a significant decline in the yen still seems elusive amid growing confidence that the Bank of Japan (BoJ) will raise interest rates further.

The BoJ's hawkish expectations were confirmed by strong consumer price index (CPI) data and continue to support Japanese government bond (JGB) yields. As a result, the narrowing rate differential between Japan and other countries should continue to support the lower-yielding JPY. In addition, the recent decline in the US Dollar (USD) amid concerns over the health of US consumers and despite bets on an extension of the rate pause by the Federal Reserve (Fed), could put pressure on the USD/JPY pair.

Trading recommendation: BUY 150.30, SL 149.70, TP 151.30

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