JPY – The Japanese yen maintains its rebound, helped by expectations of a rate hike this month

Bank of Japan Governor Kazuo Ueda revealed last week that whether the central bank will raise interest rates will depend on key economic indicators, especially wage and inflation data. Ueda also stressed that if the yen continues to depreciate after Japan's annual inflation rate exceeds its 2% target, it may pose a potential threat to the central bank's economic forecasts.

The dollar fell to a six-week low of 149.46 yen on Friday after data showed faster-than-expected inflation in Tokyo, supporting bets that the Bank of Japan would raise interest rates in December. Japan announced that the core consumer price index (CPI) in the Tokyo area increased by 2.2% year-on-year in November. The median market estimate was for an increase of 2.1%, and the increase in October was 1.8%. USD/JPY is headed for a 3.38% weekly decline, the most since July.

As seen from the technical chart, the RSI and stochastic index are still falling, with the 10-day moving average breaking below the 25-day moving average, forming a bearish cross, and the exchange rate has just fallen below the 25-day moving average last week, after the US dollar started trading against the yen in September. After breaking through this indicator, it fell back below this area for the first time last week, indicating that the dollar will have a tendency to further adjust against the yen in the short and medium term. Subsequent supports are expected to be at 149.10 and 148, the 100-day moving average, and the next key reference points are 147.30 and 145. As for the nearest resistance levels, it is expected to be 150 and 151.60. The greatest resistance will be seen at the 25-day moving average of 153.60 and 155 levels.

Forecast range:
Resistance 150.00 – 151.60 – 153.60 – 155.00
Support 149.10 – 148.00 – 147.30 – 145.00

News summary
30/11 Nikkei: Bank of Japan President Kazuo Ueda said the time to raise interest rates is “approaching”

Focus:
Monday: Japan Manufacturing PMI in November (08:30)
Wednesday: Japan’s November Service Industry Comprehensive PMI (08:30)
Thursday: All household spending in Japan in October (07:30)

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