USDJPY forecast: the US dollar continues to put pressure on the yen

Amid economic data from the US and Japan, the USDJPY rate may continue to correct towards 149.40. Find more details in our analysis for 14 March 2025.

USDJPY forecast: key trading points

• Japan’s Thomson Reuters/Ipsos Primary Consumer Sentiment Index: previously at 37.30, currently at 35.68
• US Michigan inflation expectations: previously at 4.3%, currently at 4.3%
• USDJPY forecast for 14 March 2025: 147.60 and 149.40

Fundamental analysis

The forecast for 14 March 2025 takes into account that the Japanese yen is forming a correction amid expectations of BoJ monetary policy tightening. Recent comments from Bank of Japan Deputy Governor Shinichi Uchida on a gradual rise in core inflation to the 2% target have fuelled speculation about a potential interest rate hike.

Additionally, Japan’s strong Q4 2024 GDP data exceeded expectations, which also supported the yen.

Japan’s Thomson Reuters/Ipsos Primary Consumer Sentiment Index measures consumer confidence in the country’s economy based on a monthly survey of the population carried out by research firm Ipsos together with Thomson Reuters. An increase in the index indicates growing consumer confidence, which stimulates the economy. Conversely, its decline signals caution of the population and lower consumption and investment.

Fundamental analysis for 14 March 2025 takes into account that the actual reading was down from the previous reading, coming in at 35.68.

According to the forecast for 14 March 2025, the US Michigan inflation expectations may remain unchanged at 4.3%. It is worth noting that the indicator was 3.3% for several months before growth. The actual data unchanged from the previous reading can be viewed as a neutral factor, pointing to some stabilisation in the US economy. However, a worse-than-expected reading may affect the USDJPY rate, helping the yen strengthen.

USDJPY technical analysis

Having tested the lower Bollinger band, the USDJPY price has formed a Hammer reversal pattern on the H4 chart. At this stage, it is correcting following the pattern signal. The price is expected to rise further up to the resistance level as it has rebounded from the support level and remains within a descending channel.

The target for a correction is the 149.40 level. A rebound from this level may open the potential for a more substantial downward movement.

However, the USDJPY forecast for today also takes into account another scenario, where the price falls to the 147.60 level without testing the resistance level.

Summary

Along with the USDJPY technical analysis, the decline in Japan’s economic indicators suggests a further correction towards the 149.40 resistance level.