USDJPY climbs amid renewed US trade tension, steady US yields
22.01.2025, 15:51

USDJPY climbs amid renewed US trade tension, steady US yields

  • USD/JPY uptrend extends spurred by steady US 10-year Treasury yield holding at 4.58%.
  • President Trump plans new tariffs on Chinese, European goods, spurring US Dollar recovery.
  • Bank of Japan eyes rate hike with improving wage growth and inflation, softening Yen.

The USD/JPY rose in early trading during the North American session, bolstered by Trump’s trade rhetoric against Canada, Mexico, the EU, and China. In addition, a firm US Dollar and a steady US 10-year Treasury bond yield pushed the pair above the 156.00 figure for a 0.41% gain.

USD/JPY climbs above 156.00, shrugs off BoJ rate hike speculation

On Tuesday, Trump stated his team is discussing applying 10% tariffs on China’s goods on February 1 while vowing to apply duties on European goods are also eyed. Meanwhile, the Greenback recovered following Monday’s 1.22% fall, as Trump tempered his trade rhetoric in his inauguration speech.

In the meantime, the US Dollar Index (DXY), which tracks the buck's performance against a basket of six currencies, remains unchanged at 108.13. The US 10-year T-note is yielding 4.58%, flat.

The Japanese Yen remains slightly softer even though the Bank of Japan (BoJ) is expected to raise rates at the January 23-24 meeting. Governor Kazuo Ueda and Co. got a green light as Japanese retailers are increasing wages for the second year amid rising inflation and difficulties in hiring people.

Data-wise, the US economic docket remains absent. In Japan, the Balance of Trade in December is expected to reduce the deficit to ¥-55B from ¥-117.6B.

USD/JPY Price Analysis: Technical outlook

The USD/JPY recovered after hitting a weekly low of 154.76, shy of testing a four-month-old support trendline drawn from October’s 2024 lows of 139.56.

However, buyers stepped in and pushed the exchange rate past the 155.00 and 156.00 figures, as they target the Tenkan-sen at 156.82. A breach of the latter will expose a 157.00 figure, followed by the January 14 daily high at 158.20.

Conversely, if USD/JPY tumbles below 156.00, it would expose 155.00, followed by the January 21 swing low of 154.76.

Japanese Yen PRICE Today

The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the Canadian Dollar.

  USD EUR GBP JPY CAD AUD NZD CHF
USD   0.02% 0.17% 0.53% 0.28% 0.02% 0.10% 0.14%
EUR -0.02%   0.15% 0.50% 0.25% 0.00% 0.08% 0.11%
GBP -0.17% -0.15%   0.39% 0.10% -0.15% -0.07% -0.06%
JPY -0.53% -0.50% -0.39%   -0.25% -0.50% -0.43% -0.41%
CAD -0.28% -0.25% -0.10% 0.25%   -0.25% -0.17% -0.17%
AUD -0.02% 0.00% 0.15% 0.50% 0.25%   0.08% 0.09%
NZD -0.10% -0.08% 0.07% 0.43% 0.17% -0.08%   0.00%
CHF -0.14% -0.11% 0.06% 0.41% 0.17% -0.09% -0.00%  

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).

 

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