Near 158.00: USD/JPY price forecast as V-shaped recovery extends further

158.00 in sight for USD/JPY as US Dollar outperformance persists.
Unchanged interest rates are expected from both the Fed and the BoJ this week.
Key US economic releases are also on investors’ radar this week.

The Federal Reserve’s (Fed) monetary policy announcement is due at 18:00 GMT. Caution ahead of the decision is supporting the US Dollar (USD), leaving the Japanese Yen (JPY) under continued pressure against it.

At the time of writing, a 0.1% gain has taken the US Dollar Index (DXY) to around 102.50, its highest in more than a week. The index measures the Greenback against six major currencies.

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

2024 policy outlook: Fed meeting expectations

Patience is the near-term approach anticipated by OCBC strategists, who write that they “expect the Federal Reserve to stay on hold in October, with the focus shifting quickly to December.” Their assessment highlights that “September CPI surprised to the upside,” against a backdrop in which “most FOMC participants had already indicated that another hike could be appropriate by year-end,” they note. The policy trajectory towards the final meeting of 2024 therefore remains firmly in focus.

Thursday’s scheduled releases will also draw investor attention this week: the preliminary US Q3 Gross Domestic Product (GDP) estimate and September’s Personal Consumption Expenditure (PCE) Price Index.

For the JPY, Friday brings the Bank of Japan’s (BoJ) monetary policy announcement. Interest rates are almost certain to remain at 1.25%.

157.90: USD/JPY Technical Analysis

Following a V-shaped recovery, USD/JPY is trading at 157.90 on the daily chart. The pair remains just above its 20-day exponential moving average (EMA) of 157.75, preserving a mildly bullish bias as it consolidates close to recent highs. At 51.45, the Relative Strength Index (RSI) is neutral and points to limited directional momentum. Bulls nevertheless retain an advantage while the price holds above the nearby moving average.

A daily close below immediate support at the 20-day EMA, around 157.75, would signal scope for a deeper pullback towards the recent low near 156.00. To establish a fresh upward leg, USD/JPY needs to break decisively above the 24 September high near 159.00.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Economic Data Indicator

Fed Decision on Interest Rates

At eight scheduled meetings each year, the Federal Reserve (Fed) reviews monetary policy and sets interest rates. Its dual mandate is to maintain full employment and keep inflation at 2%. Interest rates are its principal policy tool, covering both lending by the Fed to banks and lending between banks. A rate increase generally supports the US Dollar (USD) by drawing in more foreign capital. A cut typically weakens the USD as capital moves to countries offering higher returns. When rates stay on hold, the focus shifts to the Federal Open Market Committee (FOMC) statement: a hawkish tone signals expectations of higher future interest rates, while a dovish tone points to lower future rates.

View details.

Next scheduled release: Wed 28 Oct 2026 18:00

Release frequency: Irregular schedule

Market consensus: 4%

Prior reading: 4%

Data source: Federal Reserve