USDJPY:
The Japanese yen (JPY) has been falling for the second day in a row, causing the USD/JPY pair to drop to 144.75 during the Asian session, although it did not continue to fall. Expectations that the Bank of Japan (BoJ) may refrain from another interest rate hike this year, coupled with the overall positive dynamics in the stock markets, are undermining the Japanese yen’s position as a safe-haven currency. However, investors seem convinced that the central bank will stick to its policy normalisation course amid rising inflation.
This, along with growing geopolitical tensions in the Middle East, should help limit deeper losses for the Japanese yen. Traders also seem indecisive and prefer to wait for the Bank of Japan’s crucial decision on Tuesday to determine the next stage of the yen’s movement. This week, investors will also focus on the results of the two-day meeting of the US Federal Open Market Committee (FOMC) on Wednesday, which will play a key role in determining the short-term dynamics of the US dollar (USD) and give a significant boost to the USD/JPY pair.
Trading recommendation: 144.30, SL 144.50, TP 143.50
Origin: FreshForex
