USDJPY: correction complete? The yen loses ground under Fed pressure

The USDJPY rate has risen to 142.77 after weak Japanese data and hawkish remarks from Jerome Powell. Discover more in our analysis for 17 April 2025.

USDJPY forecast: key trading points

• The Japanese yen weakens amid hawkish Fed commentary
• Japan’s March exports rose by 3.9% y/y, below the forecast of 4.5%
• Japan’s imports increased by 2.0% in March, falling short of the expected 3.1%
• USDJPY forecast for 17 April 2025: 140.20

Fundamental analysis

The USDJPY rate is strengthening after rebounding from the key support level at 141.95. Despite the current upward move, the pair remains within a broader downtrend, keeping the door open for further declines. The Japanese yen weakened, retreating from its highs, as traders responded to hawkish commentary from Federal Reserve Chairman Jerome Powell, who signalled no urgency to ease monetary policy due to ongoing trade-related uncertainty.

Foreign trade data added to the yen’s pressure. Japan’s exports rose by 3.9% y/y in March, missing expectations of 4.5%, and marking a slowdown from February’s 11.4% gain. This deceleration reflects weaker shipments to China and the EU. Nevertheless, a moderate recovery in imports – up 2.0%, below the forecast of 3.1% – signals relatively firm domestic demand in the Japanese economy.

USDJPY technical analysis

The USDJPY rate has climbed after rebounding from the lower boundary of a bearish channel. Today’s USDJPY forecast suggests the current recovery could stall near 142.75, followed by bearish momentum and decline towards 140.20.

Technical indicators support the bearish scenario, with Moving Averages pointing to a steady downtrend and the Stochastic Oscillator turning down from overbought territory, signalling an imminent decline. The bearish scenario will be confirmed by a breakout below the lower boundary of the corrective channel, with the price consolidating below 142.35.

Summary

The yen is under pressure from hawkish Fed signals and weak Japanese export data. The USDJPY technical analysis suggests this correction may end, with downward momentum likely towards 140.20.