The Japanese Yen languishes near its monthly minimum against the dollar before mixed signs on the rise in Boj’s rates

• The Japanese yen tests the monthly minimum against his American counterpart.
• The reduction of bets due to an increase in BOJ rates in 2025 and commercial uncertainties weigh on the JPY.
• The lack of purchases of the USD limits the USD/JPY before the FOMC decision.

The Japanese Yen (JPY) remains defensive in front of his US counterpart for the fourth consecutive day and re -tests the monthly minimum during Wednesday’s Asian session. The Bank of Japan (BOJ) pointed out a cautious approach to undo its monetary stimulus of a decade amid uncertainties about economic growth. This forced investors to delay their expectations about the possible moment of the next increase in Boj rates to the first quarter of 2026, which, in turn, is considered to help JPY.

Meanwhile, US President Donald Trump and Japanese prime minister Shigeru Ihiba failed to achieve a breakthrough on tariffs at the G7 summit, feeding concerns about the economic repercussions of US tariffs. This contributes even more to the low relative performance of the JPY. The US dollar (USD), on the other hand, struggles to capitalize on the strong profits of the previous day before the crucial decision of the FOMC and keeps any significant movement of the USD/JPY pair.

The Japanese Yen struggles to attract buyers in the midst of faded hopes of another increase in Boj rates in 2025

• The Bank of Japan, as expected widely, maintained the reference rate without changes in 0.5% on Tuesday in the midst of growing growth risks and said it will slow down the rhythm of reductions in their purchases of government bonds from April of next year. The BOJ added that Japan’s economic growth is expected to moderate and that accommodative financial conditions provide support.
• This reinforced market expectations that the Central Bank could give up another increase in rates this year. In fact, a recent Reuters survey indicated that a slight majority of economists awaits the next increase in rates of 25 basic points in early 2026. This is considered to undermine Yen Japanese in the midst of obstacles in the commercial front before the deadline of July 9 for higher reciprocal tariffs of the US.
• Japanese Prime Minister Shigeru Ihiba, speaking with journalists after the G7 summit on Tuesday, said that he and US President Donald Trump agreed to instruct their ministers to get more involved in commercial conversations. Ishiba added that there are still some points where both parties disagree, so we have not yet reached an agreement on the commercial package.
• Meanwhile, machinery orders in Japan fell 9.1% in April, marking a strong reversal of an increase of 13% in March and the weakest reading since April 2020. In addition, the MONTHLY Survey of Reuters showed that Japanese manufacturers were less confident about commercial conditions in June and expressed caution about the perspectives for the next three months.
• From the US, the US Census Office reported on Tuesday that retail sales fell 0.9% in May compared to a contraction of 0.7% expected. To this is added that the US industrial production was also below consensus estimates and contracted 0.2% in May, which points to a weakened economy and reaffirms bets for a cut of interest rates by the Federal Reserve in September.
• However, the initial market reaction turned out to be short -lived, since the increase in geopolitical tensions in the Middle East promoted refuge flows to the US dollar. Investors now wait for the result of a two -day FOMC policy meeting to obtain more clues about the future trajectory of feat cuts, which will boost the USD and provide a new impulse to the USD/JPY torque.

The USD/JPY bulls now wait for a movement beyond the 145.45 area before positioning themselves for more profits

From a technical perspective, the night break and a daily closure above the psychological brand of 145.00 could be seen as a new trigger for the USD/JPY bulls. In addition, the oscillators in the daily chart have begun to gain positive traction and suggest that the lower resistance path for cash prices is upward. Some purchases of continuation beyond the monthly maximum, around the area of ​​145.45, will affirm the constructive perspective and allow the pair to conquer the round figure of 146.00 before aiming to test the region of 146.25-146.30 or the peak of May 29.

On the other hand, any corrective setback below the 145.00 mark could attract some buyers in the fall and find a decent support near the region of 144.50-144.45, below which the USD/JPY pair could slide to the 144.00 mark. A convincing rupture below the latter would expose the following relevant support near the region of 143.55-143.50 before cash prices eventually fall to the round figure of 143.00 on the way to the way to the minimum of last week, around the region of 142.80-142.75.