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The higher unemployment print overshadowed the rise in job openings, weighing on the Japanese Yen. Thursday’s BoJ policy statement limited the influence of job openings on the Yen, with policymakers citing potential tariff impacts on the economy, inflation, and the rate outlook.
Beyond the data, trade developments continue to influence USD/JPY trends. Progress toward trade deals with major US trading partners may dampen safe-haven flows into the Yen. In contrast, stalled negotiations or rising US-China trade tensions could fuel Yen appetite.
USD/JPY: Key Scenarios to Watch
- Bullish Yen Scenario: Rising trade tensions, stalled US-Japan trade talks, positive Japanese data, or hawkish BoJ guidance may push USD/JPY lower toward the 140.309 support.
- Bearish Yen Scenario: Easing trade tensions, a US-Japan trade deal, weak data, or a dovish BoJ stance could drive the pair above the 145 level.
USD/JPY Daily Outlook: Focus on US Jobs Report
Later in today’s US session, the US Jobs Report will further influence sentiment toward the Fed’s rate path. Economists forecast average hourly earnings to rise 3.9% year-on-year in April, up from 3.8% in March, while expecting the unemployment rate to remain at 4.2%. Nonfarm payrolls are predicted to increase by 130k after a 228k jump in March.
Rising wages, falling unemployment, and higher nonfarm payrolls may temper Fed rate cut bets, boosting US dollar demand. A less dovish Fed stance may drive the USD/JPY pair above 145, bringing the 149.358 resistance level into view. Conversely, weaker wage growth and rising unemployment may signal softer spending and inflation, raising Fed rate cut expectations. A more dovish Fed rate path could send the pair toward the 140.309 support level.
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