USDJPY: SELL 144.80, SL 145.00, TP 143.80 | 21 May 2025

USDJPY:

The Japanese yen (JPY) is weakening across the board on Tuesday, which helped the USD/JPY pair reverse the previous day's decline to a one-week low and climb towards the mid-145.00s during the Asian session. The unexpected downgrade of the US government's credit rating on Friday seems to have had a modest impact on global risk sentiment. This is evidenced by the overall positive tone in equity markets, which is seen as a key factor undermining demand for the safe-haven yen.

However, any significant fall in the yen seems unlikely amid growing confidence that the Bank of Japan (BoJ) will raise interest rates again in 2025. On the contrary, the Federal Reserve (Fed) is expected to further reduce borrowing costs amid signs of weakening inflationary pressures and sluggish growth prospects. This, in turn, could deter any attempts to boost the US Dollar (USD) and serve as a tailwind for the low-yielding Yen, which in turn should lead to a decline in the USD/JPY pair.

Trading recommendation: USDJPY: SELL 144.80, SL 145.00, TP 143.80

FreshForex offers a wonderful 300% bonus on every deposit of $100 or more, giving you the opportunity to increase trading volumes!