The Japanese Yen is strengthened in reaction to a stronger report of the PPI in Japan

• The Japanese Yen attracts new buyers as a stronger PPI reaffirms the betting bets of the Boj.
• The hopes of a commercial agreement between the US and Japan turn out to be another factor that benefits the JPY.
• A solid recovery in the feeling of global risk could limit JPY’s profits as a safe refuge.

The Japanese Yen (JPY) recovered positive traction during Thursday’s Asian session in reaction to the publication of the production price index (PPI) stronger than expected, which keeps the door open to more increases in rates by the Bank of Japan (BOJ). In addition, the optimism that Japan could reach a commercial agreement with the US turns out to be another factor that supports the JPY. This, along with a slight fall of the US dollar (USD), drags the USD/JPy torque below the round figure of 147.00 in the last hour.

Meanwhile, the expectations of a more aggressive BOJ mark great divergence compared to the growing bets for multiple cuts of interest rates by the Federal Reserve (Fed) in 2025. This, in turn, does not help the USD to capitalize on the rebound of the previous night from the weekly minimum and contributes to direct flows to the JPY of lower performance. However, a positive turn in the feeling of global risk, fed by the announcement of US President Donald Trump of Pausar reciprocal tariffs in most nations, could limit the JPY as a safe refuge.

The Japanese Yen receives support from the expectations of an aggressive box; It lacks follow -up in the middle of a turn in the feeling of risk

The preliminary report of the Japan Bank published earlier this Thursday showed that the production price index (PPI) of Japan increased 0.4% in March and rose 4.2% compared to the same period last year. The readings were superior to consensus estimates and could boost consumer prices, which, in turn, supports the case for greater hardening of politics by the BOJ and supports the Japanese Yen.

The president of the United States, Donald Trump, agreed to meet with Japanese officials to initiate commercial discussions after speaking with Japanese Prime Minister Shigeru Ishiba earlier this week. The subsequent comments of the US Treasury Secretary, Scott Besent, saying that Japan could be a priority in tariff negotiations, fed the hopes of a possible commercial agreement between the US and Japan and turned out to be another factor that supports the JPY.

The US dollar bounced against the safe refuge currencies, including JPY, on Wednesday after Trump declared an immediate 90 -day pause in large tariff increases for most countries. The announcement relieved concerns about the global economic impact of US commercial policies, triggering a strong rebound in shares. The S&P 500 shot 9.5% and registered its greatest daily gain since 2008.

Meanwhile, the minutes of the FOMC meeting of March 18-19 revealed that the officials almost unanimously agreed that the US economy was at risk of experiencing greater inflation and slower growth due to Trump’s commercial tariffs. However, those responsible for policies requested a cautious approach to interest rate cuts, forcing investors to cut their bets for a more aggressive relief by the Fed.

The operators now expect the Fed to wait until June to resume their cycle of feat cuts and are valuing only 75 basic points of rates reductions for the end of the year. However, the USD bulls seem reluctant and choose to wait for the publication of US inflation figures – the Consumer Price Index (CPI) and the Production Price Index (IPP) on Thursday and Friday, respectively – before positioning for additional profits.

The USD/JPY seems vulnerable to an additional fall; repeated failures to find acceptance above 148.00 favor bassists

From a technical perspective, the USD/JPY torque has been struggling to find acceptance above the round figure of 148.00 since the beginning of this week. In addition, the oscillators in the daily chart remain in negative territory and are still far from being in the overall area. This, in turn, favors bassists and suggests that the path of lower resistance for cash prices remains down. Therefore, a subsequent fall towards the intermediate support of 146.30, en route to the 146.00 mark, seems like a different possibility. Some additional sales would exhibit the following relevant support near the region of 145.50 before the PAR finally falls to the 145.00 psychological brand.

On the other hand, the 147.75 area, followed by the 148.00 mark, could act as an immediate obstacle before the 148.25-148.30 region, or the weekly maximum reached Wednesday. A sustained strength beyond the latter would establish the stage for an extension of the moderate rebound of the previous day from levels below 144.00, or the lowest since October 2024, and would allow the USD/JPY to recover the round figure of 149.00. The impulse could be extended even more towards the 149.35-149.40 area to the psychological brand of 150.00.