📰 Testing Whether the Yen-Weakness Trend Can Really Hold
— Directionless Trading, But the Bias Remains in Focus —
1️⃣ Market Summary
Because of Christmas holidays, Europe is closed and U.S. trading is extremely thin.
With liquidity low, USD/JPY is drifting, searching for direction around the upper 155 area.
During Tokyo trading, softer Tokyo CPI triggered yen selling and dollar buying, pushing USD/JPY up to around 156.49.
However, with London closed, upside momentum remains limited.
2️⃣ BOJ Outlook: No Yen Strength — Carry Trades Continue
In his latest speech, Governor Ueda reiterated that:
“If economic and price conditions continue to improve, we may continue raising policy rates.”
Markets judged the message as nothing new, and the reaction in FX was limited.
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The 2% inflation target is approaching, supported by wage gains
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But the timing of the next rate hike remains unclear
➡ As a result, yen carry trades remain intact.
3️⃣ Currency Moves
💵 USD/JPY
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Tokyo: climbed to 156.49
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Afterwards: oscillating in the upper 155s
➡ Still searching for direction.
Soft inflation data reduced expectations of additional BOJ tightening, making yen selling easier — but thin liquidity is capping upside.
🇪🇺 EUR/JPY
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Overseas: centered around the 183 level
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Tokyo: pushed up toward 184.43, then stalled
➡ Likely to trade within 183 mid–high range.
🇬🇧 GBP/JPY
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Overseas: mostly around 210
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Tokyo: rose to 211.42, then lost momentum
➡ Expected to pivot around the 210 handle.
🌍 EUR/USD
Sideways in the upper 1.17s
➡ Direction remains USD-driven.
🇬🇧 GBP/USD
Trading between high 1.34s and low 1.35s
➡ Consolidation near 1.35.
4️⃣ What to Watch Today (Even in Thin Markets)
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U.S. MBA Mortgage Applications
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U.S. Initial Jobless Claims
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U.S. Weekly Crude Inventory
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U.S. 7-Year Treasury Auction
With liquidity thin, even small headlines can trigger price swings —
but sustained moves are still unlikely.
5️⃣ Overall Outlook
Christmas trading conditions mean:
“Standing aside is still a valid strategy.”
The tug-of-war continues:
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Yen-weakening pressure (carry trades)
vs. -
Intervention risk and government rhetoric
➡ Result: choppy and nervous short-term moves.
Base scenario:
USD/JPY continues to search for direction within 155.50–156.50.
