USDJPY: SELL 145.80, SL 146.40, TP 144.80 | 07 Abril 2025

Event to watch out for today:

15:30 EET. USD - Non-Farm Payrolls

USDJPY:

The Japanese Yen (JPY) is showing declines during the Asian trading session on Friday, driven by growing investor concerns over the possible economic impact of retaliatory tariffs imposed by US President Donald Trump's administration. Increasing uncertainty about the outlook for global trade has forced market participants to revise their expectations regarding the Bank of Japan's (BoJ) monetary policy. In particular, concerns about a slowdown in global growth led traders to reduce the likelihood of a more aggressive interest rate hike by the BoJ, which put pressure on the yen exchange rate.

Nevertheless, continued signs of rising inflation in Japan, including growth in consumer prices and wages, suggest that the BoJ may continue its course of gradual monetary tightening. This, in turn, may support the Japanese currency in the medium term, especially if external factors do not lead to a significant deterioration in the economic situation.

An additional factor that could support the yen remains a general decline in the risk appetite in financial markets. Increasing trade disagreements between the world's largest economies are forcing investors to seek refuge in traditionally safe assets, such as the Japanese yen. Meanwhile, the continued weakening of the US dollar (USD) is also playing an important role. Expectations that the imposed tariffs may trigger an economic slowdown in the US, as well as growing bets that the Federal Reserve (Fed) will soon resume the cycle of interest rate cuts, contribute to the pressure on the USD and, consequently, support the yen.

Trading recommendation: SELL 145.80, SL 146.40, TP 144.80

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