Societe Generale analysts report that the USD/JPY currency pair has established a small base above its 50-day moving average following an earlier failed breakout attempt. The pair is now making another effort to break out of its multi-year range, with the 2024 high near 162 and projected resistance levels at 163.20 and 163.70 identified as key hurdles. The 50-day moving average, currently near 158/157.50, is highlighted as a crucial support zone for the pair [1].
The USD/JPY has recorded four consecutive days of higher highs, pushing the spot rate toward 160.00. Market participants are on alert for potential spot checks in New York, as Japanese Finance Minister Katayama has reiterated the government's readiness to take bold and decisive action to curb speculative activity in the foreign exchange market. Katayama emphasized that Japan can intervene strongly in the FX market, in line with agreements with the United States, to address excessive volatility [1].
On the macroeconomic front, Japan's Consumer Price Index (CPI) rose to 1.5% year-over-year in March, up from 1.3% in February. Core CPI increased to 1.8% from 1.6%, though these figures have yet to reflect the impact of the recent surge in oil prices. Additionally, Japan is set to begin a second round of crude oil releases from its national reserves starting May 1 [1].
CONCLUSION
The USD/JPY is resuming its uptrend, approaching significant resistance levels, while Japanese authorities signal a willingness to intervene in the FX market if speculative activity intensifies. Recent inflation data and upcoming crude oil releases add further context to the market environment, suggesting heightened vigilance and potential volatility ahead.