USD/JPY pair struggles due to a weaker US Dollar

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On the JPY side, nothing has changed fundamentally, and the currency has been mainly driven by the risk sentiment. As a reminder, the BoJ kept interest rates unchanged at 0.5% and reduced the bond tapering plan for fiscal year 2026 as expected at the last meeting. The BoJ continues to place a great deal on the US-Japan trade deal and the evolution of inflation.

USD/JPY is moving lower despite the disappointing Industrial Production report from Japan. The report showed that Industrial Production increased by +0.5% month-over-month in May, compared to analyst forecast of +3.5%. However, I think that if we respect this area, we might see upward momentum coming soon.

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