HomeMarket NewsThe Yen Struggles Amidst Japan's Deflationary Shift

The Yen Struggles Amidst Japan’s Deflationary Shift

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Authored by RoboForex Analytical Department

Despite Japan’s positive strides in overcoming deflation, the USD/JPY pair surged to 148.28 on the back of robust US retail sales data. The greenback’s dominance is clear, driving speculation around the Federal Reserve’s interest rate stance.

The Fed is closely monitoring the inflationary implications of the strong retail sales figures, potentially postponing any rate adjustments. Japan’s Finance Minister, Shunichi Suzuki, recently declared an end to the deflationary woes, citing a notable uptrend in wage growth – a far cry from previous pessimistic sentiments.

Suzuki emphasized the government’s unwavering commitment to bolstering wage growth, indicating a collective effort to sustain the upward trajectory.

With the Bank of Japan’s upcoming meeting looming, anticipation looms large. Speculations abound that the interest rate, currently at -0.1%, might exit negative territory, potentially echoing global trends as the only major central bank persisting with negative borrowing costs.

Analyzing USD/JPY Trends

The H4 chart underscores a recent upsurge in USD/JPY, peaking at 148.64. Considerations point towards a consolidation phase below this level. A breakout could pave the way for an ascent to 149.20, with further gains likely towards 150.00. Noteworthy corroborations from the MACD oscillator signal a bullish momentum.

Meanwhile, the H1 chart hints at a consolidation range near 148.22, hinting at a probable upward breakout towards 149.20. A subsequent correction might test the support at 148.22 before eyeing the 150.00 mark. The Stochastic oscillator reinforces this upward trajectory, poised for an upwards movement.


Any market insights provided here reflect the author’s personal views and should not be construed as trading advice. Readers should exercise caution and conduct independent analysis before making any financial decisions. RoboForex holds no liability for trading outcomes influenced by the content herein.

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