USD/JPY

The USD/JPY pair reverses a modest Asian session dip on Monday and climbs back above the 158.00 mark in the last hour, though it remains confined in a familiar range.

Japanese Prime Minister Sanae Takaichi said on Monday that no preset idea on whether government will compile extra budget. Takaichi added that the government plans to maintain issuance of Japanese Government Bond (JGB) at appropriate level.

Bank of Japan (BoJ) Governor Kazuo Ueda reiterated on Friday that the central bank will continue raising interest rates as underlying inflation approaches its 2% target, noting that financial conditions remain accommodative.

USD/JPY is little changed on Friday but heads for its first weekly loss in five weeks amid a sharp decline in the US Dollar (USD). However, the Japanese Yen (JPY) finds only limited support as its fundamental backdrop remains fragile.

United Overseas Bank (UOB) analysts Quek Ser Leang and Lee Sue Ann see USD/JPY in a near-term range, expecting the Dollar to trade between 157.80 and 158.50 in the 24-hour view. For the 1–3 weeks horizon, they maintain a broader 157.50–159.05 range. Over 1–3 months, they highlight building downward momentum that points to further USD/JPY weakness, though reaching the January low at 152.08 is still uncertain.

MUFG’s Michael Wan reports that Bank of Japan (BoJ) Board Member Junko Koeda has strengthened the case for further policy tightening. Koeda emphasized upside price risks, still-accommodative financial conditions and judged the neutral rate to be well above 1%.