USDJPY is under pressure amid rising inflation in Japan

The USDJPY rate reversed near the key support level at 148.55. Find out more in our analysis for 24 February 2025.

USDJPY forecast: key trading points

• The yen is supported by strong inflation in Japan
• Tokyo’s consumer prices rose by 4.0% in January
• Kazuo Ueda said the BoJ is ready to respond to market changes
• USDJPY forecast for 24 February 2025: 147.45

Fundamental analysis

The USDJPY rate is correcting after falling for three consecutive trading sessions. The yen is supported by Japan’s strong inflation data, which heightens expectations for a BoJ interest rate hike.

Consumer prices rose by 4.0% in January, up from 3.6% in December, reaching the highest level since January 2023. The key gauge for the Bank of Japan (prices excluding fresh food) increased by 3.2%, showing the strongest growth since June 2023. This creates preconditions for the yen to strengthen as part of the USDJPY forecast for today.

Meanwhile, Bank of Japan Governor Kazuo Ueda signalled the regulator’s readiness to promptly respond to changes, among others, to conduct financial interventions in case of abnormal price fluctuations.

USDJPY technical analysis

The USDJPY rate remains under pressure from a strong downward momentum. The currency pair quotes rebounded from the lower boundary of the descending channel, which may indicate buyers’ attempts to develop a bullish correction towards 149.95. The Stochastic Oscillator is in the oversold area, supporting the scenario with a short-term price rise.

According to the USDJPY forecast for today, the bullish correction is expected to end at the 149.95 resistance level, followed by a decline to the 147.45 target. An alternative scenario suggests a breakout above the upper boundary of the descending channel, with the price consolidating above 150.45, which may lead to growth to 151.35.

Summary

The USDJPY rate is under pressure amid Japan’s strong inflation data. The USDJPY technical analysis indicates potential growth to 149.95, followed by a decline to 147.45.