USD/JPY has broken decisively above the critical 161.95 resistance level, signalling a continuation of its medium-term bullish trend despite repeated verbal intervention from Japanese officials. A widening US-Japan yield differential, expectations of further Federal Reserve tightening, Japan's expansive fiscal stimulus, and persistent foreign capital inflows into Japanese equities continue to weaken the yen.
USD/JPY Price Forecast: Holds breakout above 162.00
The Japanese yen continued its strong downward trend this week, reaching its lowest level in over 40 years. The USD/JPY crossed the crucial resistance of 162, bringing its 12-month gains to 12.3%.
Brazil scored in the 95th minute to beat Japan 2-1. At about the same time, the USDJPY is ticking to a high or 161.97 which continues to push against the highest level since the end of 1986.
The American currency is losing ground as traders continue to take profits near yearly highs.
The US Dollar to Japanese Yen (USD/JPY) exchange rate fell sharply on Monday in highly volatile trading, fuelling market speculation that Japanese authorities may have intervened to support the embattled yen. Latest — Exchange Rates:Dollar to Yen (USD/JPY): 161.8975 (+0.06%)Euro to Dollar (EUR/USD): 1.14086 (+0.21%)Pound to Dollar.
USDJPY in the short term is still facing a resistance zone around 160.90-161.95 as the last time the market reached it, the Bank of Japan warned about possible intervention to support the yen. Traders should take Precautionary measures as the Bank Of Japan could intervene any time in the market.
USD/JPY is once again knocking on the door of Japan's intervention zone, but this week's battle is about far more than whether Tokyo steps into the market. It has become a high-stakes game of chicken.
USD/JPY Price Forecast: Remains sideways below 162.00 despite Japan intervention fears
It was a mixed week for markets. U.S. and Japanese stocks made new highs, but later finished lower as concerns about AI stock valuations weighed on sentiment.
USDJPY was a tad lower on Friday but remains close to new peak at 161.95 (Thursday / 3 July 2025) and in the zone where Japanese authorities may intervene.
The US side of the equation continues to drive USD/JPY. With little new from Japan, Thursday's US payrolls report looms as the week's defining event.