USD/JPY Price Forecast: Navigates at 147.28 Amid US CPI Surprises & JPY Indicators

The USD/JPY currency pair saw a slight decline in its latest session, marking a 0.23% drop to close at 147.28. This movement reflects the ongoing dynamics between the US dollar and the Japanese yen, influenced by a mix of economic indicators and market sentiment.

Japanese Economic Indicators Influence JPY’s Performance

The BSI Manufacturing Index revealed a sharper decline than anticipated, standing at -6.7 compared to the previous 6.2, signalling challenges in the manufacturing sector. Moreover, Japan’s Producer Price Index (PPI) year-over-year remained stable at 0.6%, aligning with expectations but highlighting modest inflationary pressures within the production sector.

Recent GDP and Monetary Supply Data

Earlier reports showed Japan’s final GDP for the quarter marginally increasing by 0.1%, beneath the expected 0.3%, suggesting slow economic growth. The GDP Price Index year-over-year matched forecasts at 3.9%, indicating steady inflation levels.

Additionally, Japan’s M2 Money Stock year-over-year increased slightly to 2.5%, reflecting changes in monetary supply.

US Economic Events Impacting USD/JPY

In the US, the Core CPI month-over-month rose to 0.4%, slightly above expectations, suggesting persistent inflationary pressures.

The overall CPI month-over-month also matched the higher end of forecasts at 0.4%, with a year-over-year increase to 3.2%, surpassing the predicted 3.1%. These figures suggest ongoing inflation concerns, potentially influencing Federal Reserve policies.

Implications for USD/JPY

The USD/JPY pair’s movement is a reflection of these economic indicators and events, with the yen showing resilience amidst Japan’s mixed economic data.

The US inflation data, exceeding expectations, adds complexity to the Federal Reserve’s decision-making process, potentially impacting future movements of the USD/JPY pair.

Investors and traders closely monitor these developments, as they can significantly influence the currency pair’s short-term and long-term trajectories.

USD/JPY Price Forecast: Technical Outlook

In the latest trading session, the USD/JPY pair experienced a modest decline of 0.23%, with the price settling at 147.289. The pivot point for this currency pair is identified at 148.16, indicating a crucial juncture for future price movements.

Resistance levels are outlined at 149.06, 149.82, and 150.83, marking potential hurdles for upward trends. Conversely, support is found at 146.72, 145.89, and 144.79, providing safety nets against further drops.

The Relative Strength Index (RSI) stands at 40, suggesting a bearish sentiment, while the 50-day Exponential Moving Average (EMA) at 148.35 further supports this outlook. A notable completion of a 38.2% Fibonacci retracement at approximately 148.160, coupled with the formation of a Doji candle below the 148.162 level, hints at a potential selling trend.

Consequently, the overall trend for USD/JPY remains bearish below the 148.16 threshold, with any breach above this level possibly signaling a shift to a more bullish stance.