The Japanese yen weakened slightly against the U.S. dollar on Monday, extending intraday losses as the greenback found modest support from firm Treasury yields and cautious risk sentiment. Despite the pullback, analysts believe the downside for the yen may be limited due to broader market uncertainties and potential intervention risks.
USD/JPY rose to around 154.65, climbing from earlier session lows as traders favored the dollar amid lingering concerns over global growth and a cautious tone from Federal Reserve officials. U.S. yields edged higher, providing a modest lift to the dollar, while the yen remained pressured by Japan’s persistently loose monetary policy.
USD/JPY 4-H Chart as of April 25th, 2025 (Source: TradingView)
However, market participants noted that further yen weakness could attract the attention of Japanese authorities, who have previously signaled discomfort with sharp currency moves. Verbal intervention from Tokyo has become more frequent in recent weeks, suggesting policymakers may step in if the yen depreciates too quickly or approaches critical levels near 155.
The move comes against a backdrop of mixed global risk sentiment, with investors balancing concerns over inflation, slowing growth in China, and central bank policy divergence. While the Fed remains cautious on cutting rates, the Bank of Japan has maintained an accommodative stance, continuing to widen interest rate differentials and putting downward pressure on the yen.
Despite the current trend, technical indicators point to near-term exhaustion in USD/JPY’s upside, with resistance building near the 155.00 threshold. Support is expected around the 153.80–154.00 area, where buyers have previously stepped in during minor pullbacks.
For now, the pair’s direction may depend on incoming U.S. data and any shift in rhetoric from Japanese officials. Traders remain alert to the risk of intervention, keeping a lid on aggressive dollar buying as the yen hovers near multi-decade lows.
