In today's Thursday trading, the Japanese yen plummeted to its lowest level in four months against the US dollar, with losses extending to the 156.13 level, and the USD/JPY pair is currently trading around the 155.90 level at the time of writing this analysis.
This comes ahead of the release of a batch of important US economic data, including the release of the Producer Price Index readings, one of the tools for measuring US inflation, as well as the release of weekly jobless claims data. On the same day, there will be statements from Federal Reserve Chairman Jerome Powell.
US Dollar Gains Increase with Trump's Policies
Undoubtedly, the strength of the US dollar reflects the fading expectations of the amount of interest rate cuts coming from the US Federal Reserve, with investors preparing for inflation to remain above the Federal Reserve's target of 2.0% for a long time. US inflation rates may increase under Trump's trade policies, which include withholding exports and raising customs tariffs - Trump's trade - which will remain a factor of strength for the US dollar in the coming months. In contrast, the Japanese yen remained under pressure from the strength of the US dollar, as bets on "Trump deals" increased despite expectations that the Federal Reserve will gradually reduce borrowing costs.
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US inflation rates rise
According to economic data, the US government has announced an increase in US inflation in October. According to the announcement, the main US consumer price index rose by 0.2% on a monthly basis in October, bringing the annual rate to 2.6% from 2.4% in September. According to the announcement, the core consumer price index also rose by 0.3% for the third consecutive month, with a three-month annual rate of 3.6%, faster than the 12-month rate of 3.3%.
Will the USD/JPY pair reach the 160.00 peak?
According to the performance on the daily time frame chart attached, the general trend of the USD/JPY currency pair is bullish. Moreover, dear reader by considering, that these gains are enough to push the technical indicators towards strong overbought levels. Also, it must be considered that the new US policies may bring more strength to the trend upwards. Accordingly, we recommend buying the US dollar against the Japanese yen from every downward level.
USD/JPY Technical Analysis and Expectations Today:
Currently, the closest resistance levels for the USD/JPY pair are 154.80 and 152.00, respectively. The psychological resistance of 160.00 will remain the next target for bulls, which is often the subject of talk about Japanese intervention in the Forex markets to stop the collapse of the Japanese yen exchange rate.
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