MAs Keeping the Trend Bearish for USD/JPY as BOJ Pivots
The pressure continues to remain to the downside for USD/JPY as inflation grows in Japan
The JPY was declining pretty fast until October, as the Bank of Japan (BOJ) was keeping the policy unchanged, with interest rates at -0.10%, while many other central banks kept raising rates like crazy. Although, the reason for that was low inflation in Japan, while in Europe and the US prices have been surging.
The BOJ announced a policy move late last year, which has been keeping the JPY bullish since then, with USD/JPY falling below 130 early last week. Inflation has been picking up in Japan in the last several months, which is a reason for the BOJ to change the policy and tighten somewhat, although the economy is weakening so this is a difficult decision.
Consumer prices in Japan’s capital exceeded BOJ’s 2% for the seventh month running. Today’s Tokyo core CPI inflation reading came in at 4.0% YoY, which is the highest since April 1982 with the core-core reading rising to 2.7% y/y in December, up from 2.5% y/y in November.
USD/JPY Live Chart
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