USD/JPY Price Forecast: Jumps to near 158.40 as traders reassess hawkish BoJ bets
The Japanese Yen (JPY) underperforms its currency peers on Thursday, with the USD/JPY pair trading 0.55% higher to near 158.40.
The Japanese Yen (JPY) experienced a significant decline against major currencies, leading to the USD/JPY pair jumping to near 158.40 on Thursday. Traders reduced expectations of Bank of Japan (BoJ) interest rate hikes following the release of the Summary of Opinions (SoP) from the September policy meeting. The Yen was notably the weakest against the US Dollar, with MUFG analysts attributing the drop to disappointment over the BoJ's signal for a hike.
This move prompted Japanese rate market participants to reduce BoJ hike expectations, from around 10 basis points to 5 basis points. Analysts maintain a bullish outlook for USD/JPY, with the pair trading above the 20-period Exponential Moving Average and supported by the Relative Strength Index. The US Dollar Index reached a yearly high, further strengthening the US Dollar and pushing USD/JPY higher.
Immediate support is seen at the 20-day EMA, and a break below this level could signal a deeper correction.
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