- USD/JPY bulls turn cautious near a one-and-half-month peak amid mixed fundamental cues.
- The BoJ’s cautious approach and the upbeat market mood undermine the safe-haven JPY.
- Fed rate-cut uncertainty keeps the USD bulls on the defensive and cap gains for the major.
The USD/JPY pair consolidates around the 158.00 round figure during the Asian session on Thursday and remains well within the striking distance of its highest level since late April touched last week. The mixed fundamental backdrop, meanwhile, warrants some caution before positioning for an extension of the recent appreciating move witnessed over the past two weeks or so.
The Japanese Yen (JPY) is undermined by the Bank of Japan's (BoJ) decision to hold off on any discussions around JGB tapering until the next meeting. Apart from this, the underlying bullish tone across the global equity markets is seen denting demand for the safe-haven JPY and lending support to the USD/JPY pair. However, speculations that Japanese authorities might intervene to prop up the domestic currency, along with persistent geopolitical tensions and political uncertainty in Europe, should limit any meaningful downside for the JPY.
Furthermore, the BoJ Governor Kazuo Ueda's hawkish remarks earlier this week, saying that the central bank could raise rates in July depending on economic data, might hold back the JPY bears from placing aggressive bets. Meanwhile, the US Dollar (USD) continues with its struggle to attract any meaningful buyers and languishes near the weekly low amid expectations that the Federal Reserve (Fed) will cut interest rates twice this year, bolstered by signs that inflation is subsiding. This might contribute to keeping a lid on the USD/JPY pair.
Market participants now look to Thursday's US economic docket, featuring the release of the usual Initial Jobless Claims, the Philly Fed Manufacturing Index and housing market data – Building Permits and Housing Starts. This, along with the US bond yields and Fedspeak, will influence the USD price dynamics and provide some impetus to the USD/JPY pair. Traders will further take cues from the broader risk sentiment to grab short-term opportunities ahead of the Japan National Core CPI and the global flash PMI prints on Friday.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks

EUR/USD remains offered and challenges 1.0800
The intense recovery in the US Dollar keeps the price action in the risk complex depressed, forcing EUR/USD to recede further and put the key support at 1.0800 to the test on Friday.

GBP/USD breaks below 1.2900 on stronger Dollar
Persistent buying pressure on the Greenback has pushed GBP/USD to multi-day lows below the 1.2900 level, as investors continue to digest the recent interest rate decisions from both the Fed and the BoE.

Gold meets support around the $3,000 mark
The combined impact of a stronger US Dollar, continued profit taking, and the effects of Quadruple Witching weighed on Gold, pulling its troy ounce price down to around the pivotal $3,000 level on Friday.

US SEC Crypto Task Force to host the first-ever roundtable on crypto asset regulation
The US Securities and Exchange Commission (SEC) Crypto Task Force will host a series of roundtables to discuss key areas of interest in regulating crypto assets. The “Spring Sprint Toward Crypto Clarity” series’ first-ever roundtable begins on Friday.

Week ahead – Flash PMIs, US and UK inflation eyed as tariff war rumbles on
US PCE inflation up next, but will consumption data matter more? UK budget and CPI in focus after hawkish BoE decision. Euro turns to flash PMIs for bounce as rally runs out of steam. Inflation numbers out of Tokyo and Australia also on the agenda.

The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.