USD/JPY Drops Below 150, Japan CPI to Decide Next Move
| Action Insight Mid-Day Report 2-20-25 |
USD/JPY Drops Below 150, Japan CPI to Decide Next Move |
Yen continues to dominate the relatively quiet forex markets today, with USD/JPY slipping below the key 150 psychological. The move is largely fueled by rising speculation that BoJ may tighten policy again sooner than expected, a sentiment that's also reflected in 10-year JGB yield's rally to another 15-year high. While the base case for BoJ’s next rate hike remains in the second half of the year, traders are increasingly betting on an earlier move—especially if this year’s Shunto wage negotiations deliver wage increases in line with last year’s strong outcomes. The next major test for Yen will be Japan’s January CPI release in the upcoming Asian session. The market is expecting core CPI to rise slightly from 3.0% to 3.1%. Any upside surprise, particularly if core-core CPI (which excludes fresh food and energy) also rises, could strengthen market conviction that BoJ may need to act sooner than currently anticipated. A hot inflation print, combined with rising wage pressures, would likely push traders to further price in an earlier rate hike and adding to Yen strength. Beyond Yen’s rally, Nikkei 225 is also worth watching, as its technical outlook could provide further signals. Firm break of 38401.82 support could be an earlier sign that corrective rebound from 31156.11 has finally completed. That would set up deeper fall to 38.2% retracement 31156.11 to 40398.23 at 36867.74. If realized, deeper decline in Nikkei should also be accompanied by extended fall in USD/JPY. ... |
USD/JPY Mid-Day Outlook Daily Pivots: (S1) 151.06; (P) 151.68; (R1) 152.12; More... Intraday bias in USD/JPY remains on the downside for the moment. Fall from 158.86 is seen as the third leg of the pattern from 161.94 high. Deeper decline should be seen to 61.8% retracement of 139.57 to 158.86 at 146.32 next. On the upside, above 151.22 minor resistance will turn intraday bias neutral again first. But near term outlook will now stay bearish as long as 154.79 resistance holds. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 00:30 | AUD | Employment Change Jan | 44.0K | 20.0K | 56.3K | 60.0K | | 00:30 | AUD | Unemployment Rate Jan | 4.10% | 4.10% | 4.00% | | 01:00 | CNY | 1-Y Loan Prime Rate | 3.10% | 3.10% | 3.10% | | 01:00 | CNY | 5-Y Loan Prime Rate | 3.60% | 3.60% | 3.60% | | 07:00 | CHF | Trade Balance (CHF) Jan | 6.12B | 3.55B | 3.49B | 3.48B | | 07:00 | EUR | Germany PPI M/M Jan | -0.10% | 0.60% | -0.10% | | 07:00 | EUR | Germany PPI Y/Y Jan | 0.50% | 1.30% | 0.80% | | 13:30 | CAD | Industrial Product Price M/M Jan | 1.60% | 0.80% | 0.20% | | 13:30 | CAD | Raw Material Price Index Jan | 3.70% | 2.40% | 1.30% | | 13:30 | CAD | New Housing Price Index M/M Jan | -0.10% | 0.10% | -0.10% | | 13:30 | USD | Initial Jobless Claims (Feb 14) | 219K | 216K | 213K | 214K | | 13:30 | USD | Philadelphia Fed Manufacturing Survey Feb | 18.1 | 25.5 | 44.3 | | 15:00 | EUR | Eurozone Consumer Confidence Feb P | -14 | -14 | | 15:30 | USD | Natural Gas Storage | -191B | -100B | | 16:00 | USD | Crude Oil Inventories | 3.2M | 4.1M |
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