USD/JPY HITS SEVEN-MONTH LOWS NEAR 142.00 AS THE SELL-OFF EXTENDS
USD/JPY HITS SEVEN-MONTH LOWS NEAR 142.00 AS THE SELL-OFF EXTENDS
The USD/JPY currency pair has experienced a significant decline, reaching its lowest level in seven months just above 142.00.
This downturn is attributed to a combination of factors influencing both the U.S. Dollar (USD) and the Japanese Yen (JPY).
The U.S. administration's announcement of a 50% tariff hike on Chinese goods has led to reciprocal measures from China, which increased tariffs on U.S. products from 84% to 125%.
This escalation has heightened global economic uncertainty, prompting investors to seek safe-haven assets like the JPY.
Amidst global market volatility, the JPY has strengthened as investors flock to safe-haven currencies.
This shift has been exacerbated by concerns over the U.S. economic outlook, further pressuring the USD/JPY pair.
Market participants anticipate that the Bank of Japan (BoJ) may consider tightening monetary policy in response to persistent inflationary pressures.
In contrast, expectations are growing that the U.S. Federal Reserve may implement interest rate cuts to counteract slowing economic growth, widening the policy divergence between the two central banks and weighing on the USD.
The pair has breached key support levels, with the next significant support zone identified around 142.00.
A sustained move below this level could lead to further downside momentum.
