Created
: 2025.08.26
2025.08.26 22:07
USD/JPY lost its traction and declined below 147.00 after posting strong gains on Monday. Although the pair recovers above 147.50 region in the second half of the day on Tuesday, it remains in negative territory.
The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the New Zealand Dollar.
USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
---|---|---|---|---|---|---|---|---|
USD | -0.16% | -0.16% | -0.18% | -0.08% | -0.05% | -0.03% | 0.02% | |
EUR | 0.16% | 0.06% | 0.09% | 0.08% | 0.16% | 0.36% | 0.20% | |
GBP | 0.16% | -0.06% | 0.04% | 0.05% | 0.14% | 0.30% | 0.14% | |
JPY | 0.18% | -0.09% | -0.04% | 0.00% | -0.01% | 0.29% | -0.03% | |
CAD | 0.08% | -0.08% | -0.05% | -0.00% | 0.05% | 0.26% | -0.04% | |
AUD | 0.05% | -0.16% | -0.14% | 0.00% | -0.05% | 0.02% | -0.09% | |
NZD | 0.03% | -0.36% | -0.30% | -0.29% | -0.26% | -0.02% | -0.16% | |
CHF | -0.02% | -0.20% | -0.14% | 0.03% | 0.04% | 0.09% | 0.16% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).
Following the sharp decline seen on Federal Reserve (Fed) Chairman Jerome Powell's dovish comments on Friday, USD/JPY started the week on a bullish note as the US Dollar (USD) corrected higher on Monday.
The renewed selling pressure surrounding the USD in the Asian session on Tuesday caused USD/JPY to turn south. United States (US) President Donald Trump shared a letter addressed to Fed Governor Lisa Cook on Truth Social and announced that he has fired her.
In response, Cook released a statement via her attorneys, noting that Trump has no authority to fire her and that she will carry out her duties. This development helped the USD find a foothold. In the meantime, the US Census Bureau reported that Durable Goods Orders declined by 2.8%, or $8.8 billion, in July to $302.8 billion, compared to the market expectation for a decrease of 4%.
Later in the American session, the Conference Board will publish the Consumer Confidence Index data for August. Market participants will also keep an eye on headlines surrounding the Trump-Fed feud.
The Japanese Yen (JPY) is one of the world's most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan's policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.
One of the Bank of Japan's mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen.
Over the last decade, the BoJ's stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential.
The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen's value against other currencies seen as more risky to invest in.
Created
: 2025.08.26
Last updated
: 2025.08.26
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