Skip to content USDJPY Fundamental Analysis – 17-October-2024
Last Thursday, the Japanese yen climbed to approximately 149.3 against the dollar, lingering near its 11-week low, triggered by less favorable trade data. Japan reported a shift to a trade deficit in September, marked by an unexpected drop in exports and a deceleration in import growth.
The USD/JPY 4-hour chart below demonstrates the price, support, and resistance levels.
Insights on Japan’s Trade Dynamics
Japan’s recent trade data reveal a downturn, with exports falling unexpectedly and import growth gradually shrinking. This shift to a deficit in September highlights fluctuations in the nation’s trade activity.
Bank of Japan official Seiji Adachi commented this week that the groundwork has been laid for stabilizing monetary policies. However, he stressed the importance of slowly increasing interest rates, cautioning against sharp policy shifts due to global economic uncertainties and slow domestic wage increases.
External Influences on the Yen
Amid these developments, the yen remains under pressure due to a strengthening dollar. Expectations that the U.S. Federal Reserve might not reduce interest rates aggressively have influenced this trend. Additionally, U.S. policies, perceived as likely to intensify inflation, further suggest that rate decreases may be limited.
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