USDJPY: BUY 149.20, SL 148.80, TP 150.00 | 28 February 2025

Event to watch out for today:

15:30 EET. USD - Core PCE Price Index

USDJPY:

The Japanese yen (JPY) is declining against its US counterpart during the Asian session on Thursday, although it remains near the highest level since October 2024 reached earlier this week. Comments from Bank of Japan (BoJ) Governor Kazuo Ueda last week about a potential increase in regular bond purchases led to a further decline in Japanese government bond (JGB) yields. In addition, concerns over US President Donald Trump's tariff plans and a positive tone on risks proved to be key factors undermining the yen exchange rate.

However, a significant Yen depreciation still seems unlikely amid growing market confidence that the Bank of Japan will continue to raise interest rates this year amid rising inflation in Japan.

Nevertheless, Federal Reserve (Fed) Chairman Jerome Powell has made it clear that policymakers are in no hurry to cut interest rates. What's more, previously released U.S. consumer inflation data suggests that the Fed doesn't have much room to cut rates this year. This, in turn, pushed US Treasury bond yields up, widening the yield differential between the US and Japan and limiting the upside potential for the low-yielding Yen.

Trading recommendation: BUY 149.20, SL 148.80, TP 150.00

Fund your account with cryptocurrency and you will receive up to 10% in balance on your first deposit. The additional funds will be used for trading, increasing trading volumes and helping you withstand drawdowns.