According to FXStreet, on February 10, the Japanese Yen (JPY) depreciated due to concerns that Japan could become the target of trade tariffs from US President Donald Trump. At the same time, a slight increase in the USD also helped the USD/JPY pair maintain its upward momentum around 152.00.
However, the JPY is unlikely to fall further, as there are growing expectations that the Bank of Japan (BoJ) will continue to raise interest rates this year. In addition, higher Japanese government bond yields (JGB) help narrow the interest rate gap between Japan and the US, which could limit the decline of the Yen. With no major economic data from the US, investors are still waiting for a clearer signal before confirming whether USD/JPY will continue to rise.
US President Donald Trump has just announced that he will impose a 25% tariff on steel and aluminum imports into the US, and may impose a tax on countries with trade policies that he considers unfair.
Concerns that these protectionist policies could increase inflation, along with strong US employment data last week, could keep the US Federal Reserve (Fed) unchanged. This helps the USD maintain its strength.
The US employment report showed the unemployment rate fell to 4%, while average hourly earnings increased more strongly than expected by 4.1%. However, the number of new jobs reached only 143,000 in January, lower than the previous forecast of 170,000 and the adjustment of 307,000.
Meanwhile, the International Monetary Fund (IMF) warned that Japan needs to monitor the impact of fluctuations in the global financial market, as this could affect the liquidity of domestic financial institutions. The IMF also noted that the BoJ's rate hike could increase public debt costs and the risk of bankruptcies for businesses.
A senior BoJ official, General General General General Masuhiro Masaki, said the central bank will continue to raise interest rates if inflation approaches the 2% target. The data also showed that real wages in Japan increased by 0.6% in December, marking the second consecutive month of growth which further strengthens the possibility of the BoJ continuing to tighten monetary policy.
In addition, at the January meeting, members of the BoJ also discussed the possibility of continuing to raise interest rates, which could support the Japanese Yen in the coming time.
According to Lao Dong at 12:00 on February 10, 2025, the Yen decreased to 151.973 USD/JPY, meaning 1 USD could be exchanged for about 151~152 JPY.
