USD/JPY fell to 143.63, down 0.6%, as rising Japanese government bond yields narrowed the U.S.-Japan rate differential. Investors moved into the yen and other safe-havens following reports of Israeli preparations for a potential strike on Iranian nuclear facilities, as well as fresh demand for JGBs amid a volatile domestic auction.
The dollar’s retreat also followed cautious language from Fed officials and expectations that U.S. officials may tolerate a softer dollar in ongoing G7 discussions. Technically, the pair now trades below the key 145.80 resistance band and its 50-period SMA, with sellers building momentum in line with rising volatility expectations.
