Japanese Yen: Supported below 160 against US Dollar – Scotiabank

Scotiabank analysts Shaun Osborne and Eric Theoret state that the Japanese Yen is slightly stronger against the US Dollar, with enhanced performance driven by positive domestic economic indicators such as robust retail sales and industrial production. The Bank of Japan's September meeting is of particular interest, with officials likely to make appropriate decisions.

In USD/JPY trading, there is resistance around the 160 level, and the currency pair is currently trading within a near-term range of 159.00-159.50. The Japanese Yen has risen by 0.2% versus the US Dollar and is outperforming most G10 currencies except the Norwegian Krone and Swedish Krona, as these currencies are also experiencing brief declines following former Fed Chair's remarks at the Jackson Hole speech.

Recent domestic data releases have been positive, with a significant increase in July retail sales and an unexpected boost in industrial production, both of which exceeded expectations. The Bank of Japan is set to announce its policy decision on September 18, and there is speculation that US Secretary Bessent anticipates Governor Ueda to take the right actions.

Board member Takata will also be speaking later this week. In USD/JPY, there is strong resistance above 160, while the 159.50 resistance level is providing short-term support, with the 159.00 level acting as the lower bound of the near-term range.