Skip to content USDJPY Fundamental Analysis – 21-October-2024
The Japanese yen strengthened as it moved toward 149 against the dollar this Monday, marking its second consecutive gain. This upward trend comes after the yen’s drop to the 150 mark last week, which led to renewed cautioning statements from the Japanese government, hinting at the possibility of intervention in the currency market.
The USD/JPY 4-hour chart below demonstrates the price, support, and resistance levels.
Renewed Government Warnings Influence Yen
Last week, the yen fell to a low of 150.32 against the dollar, the weakest in 11 weeks, driven by a robust US economy and speculation around a potential second term for Donald Trump.
These developments prompted Japan’s chief currency official, Atsushi Mimura, to reemphasize the government’s stance on stabilizing the yen, noting their vigilance over rapid fluctuations in its value.
Inflation Rates in Japan Decline
Recent statistics indicate a decrease in Japan’s inflation rates, with headline and core inflation dropping to a five-month low of 2.5% and 2.4% in September. This slowdown contributes to the broader economic context affecting the yen.
Earlier this year, when the yen crossed 160 against the dollar, Japanese authorities stepped in to regulate its value. The financial markets are now closely monitoring the 150 threshold, which is increasingly seen as a critical point that could prompt further government action to stabilize the currency.
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