A Bank of Japan press conference could bring movement to the USDJPY as it hovers around key levels.
USDJPY is trading in a tight range ahead of the mid-2024 lows around 140. The pair will look for a driver to test that support or to break above the 144.11 level.
The Bank of Japan is expected to hold its key interest rate at 0.5% on Thursday but the press conference at 2:30pm HKT may bring more clarity.
Analysts will be keen to hear the latest thoughts of BOJ policy makers after their rate hike plans were delayed by tariffs.
The BOJ recently forecast a 1.1% gross domestic product for 2025 and 1% in 2026. Those figures could be revised amid the ongoing trade war, given that Japan is an export-dependent economy. The median outlook for consumer inflation is 2.4% and 2% over the same period.
Japan’s Economy Minister, Ryosei Akazawa, repeated that they expect the complete removal of tariff levies. He added that he clarified that the government is not considering sacrificing agricultural products for the sake of automobiles in the negotiations.
Finally, BoJ Governor Kazuo Ueda said last week that the bank will continue to carefully monitor economic and price data in relation to its interest plans. Ueda’s comments will be studied at today’s press conference.
That could boost the US share markets this week if tech earnings are positive and the economy shows some solid foundation after the recent turmoil. Traders may wait for the BOJ comments to apply more pressure on the US dollar after yesterday’s ADP Employment Change report said the private sector added 62K new job positions in April. That was lower than the 108K anticipated by market participants. The preliminary estimate of Q1 GDP also missed expectations, as the economy contracted at an annualized pace of 0.3% against the anticipated 0.4% expansion.
