USD/JPY Rises to 162.73 on July 1, 2026 — Strong US Jobs & Yields Boost Dollar

Quick overview

USD/JPY currency pair maintained its previous day bullish performance and is still showing gains on the day. However, the reason for its bullish performance can be attributed to the previously released strong US job numbers and rising US Treasury yields, which underpinned the US dollar and contributed to the gains in the USD/JPY pair. Apart from this, the weaker Japanese Yen was also helping the pair to stay bid.

Looking forward, the biggest report is coming tomorrow, which will strongly affect this pair. On Thursday, the US Nonfarm Payrolls (NFP) report for June will be released, which is very important data to watch.

This is why investors keeping thier eyes on this data. This job data is important because it will show what the US Federal Reserve will do with interest rates. As of now, the market is expecting almost a 90% chance that the Fed will raise interest rates at least once this year.

Experts estimate that only 114,000 new jobs will be added this time. Last month, this number was 172,000. This means the pace of job growth has slowed down.

At the time we are writing this article, the USD/JPY pair is trading at 162.68 level, showing 0.10% gains on the day.

US Dollar Gets Stronger Before Important Jobs Data

On the US front, the broad-based US dollar is becoming stronger and the reason for this is rising US Treasury yields. Yields mean that the US government is paying more interest on its borrowing. When interest is higher, people prefer to keep their money in the US Dollar, due to which the value of the dollar is increasing against the Japanese Yen.

As of now, the 10-year yield rose by 0.18 percent to 4.47 percent. That is why the USD/JPY pair has also moved slightly higher. However, the reason behind this increase in yields and the US Dollar can be linked to the previously released strong US data.

According to the JOLTS report released yesterday, there were 7.594 million new job openings in May, which were higher than the market expectation of 7.3 million.

Now today, the ADP jobs and ISM factory data are due to be released, and tomorrow the major NFP jobs report is coming, which is considered very important data.

Japanese Yen Still Weak Against Dollar

On the other side, the Japanese Yen is showing some weakness because the US economy is looking strong while Japan economy is still moving slowly. Because of this, people are preferring the US Dollar more. Japanese officials are very concerned about this.

That is why Japans Chief Cabinet Secretary Minoru Kihara said that the government is ready and they can take action in the forex market at any time to support the Yen. This means they can buy the dollar to prevent the Yen from falling more.

At this time, people are talking about the possibility that the BoJ may raise its interest rates slightly at any time. If rates increase, the Yen could become a little stronger. However, the BoJ is moving very slowly because Japans economy is still weak.

The market believes that a rate hike will not happen soon, which is why the Yen is still continuing to fall, and traders are waiting for the BoJ’s next meeting.

ABOUT THE AUTHOR See More

Arslan Butt

Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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