Usdjpy sees slight decrease as mixed economic signals emerge

USDJPY Analysis

Performance after Thursday
Period	Pct	Chg	Momentum
Thursday	-0.17%	-25 Pips
Week to-date	-0.18%	-26 Pips
August	-2.41%	-364 Pips

Upcoming key events (London Time)

No major events for the day.

What happened lately

In June 2025, Japan experienced a significant decrease in its Current Account non-seasonal adjustment to 1348.2 billion yen from May’s 3436.4 billion yen. This decline suggests a reduction in the surplus Japan earns from international trade and investment returns. However, there was a positive development in Japan’s labor market. The Monthly Labour Survey indicated that Total Cash Earnings increased to 2.5% year-on-year in June, up from 1% in May. This uptick in earnings could signal improving economic conditions and increased consumer spending potential within Japan.

The U.S. economy showed positive developments in labor productivity, with Nonfarm Business Labor Productivity growing by 2.4% in Q2 2025 following a decline of -1.5% in Q1. This measure reflects the efficiency of labor in producing goods and services, which is crucial for economic growth. Additionally, the Unit Labor Costs in Q2 saw a significant drop to 1.6% from 6.6% in Q1. This reduction implies that wage growth is not outpacing productivity gains, which is favorable for businesses managing labor expenses. However, the labor market showed mixed signals, as Initial Unemployment Insurance Claims rose to 226,000 in the week ending August 2, compared to the previous figure of 219,000.

Regarding the USDJPY exchange rate, the data releases could have mixed effects. The decline in Japan’s Current Account surplus might weaken the yen due to fewer international yen transactions. However, the rise in Japanese labor earnings could support the yen by improving consumer confidence and spending. On the U.S. side, increased labor productivity and lower unit labor costs generally boost the dollar’s appeal, while higher unemployment claims could create cautionary pressure. Overall, the drop in USDJPY by 0.17% to 147.10 suggests a consolidation phase as the markets digest these mixed economic signals from the U.S. and Japan. Without any major upcoming events, the pair might continue to range as investors assess the balance between economic strengths and weaknesses in both countries.

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What can we expect from USDJPY today?

USDJPY on Thursday dropped -0.17% to 147.10. Price is below 9-Day EMA while Stochastic is rising in oversold zone.

Updated daily direction for USDJPY looks mixed as the pair is likely to consolidate above 146.6 (S1).

Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 147.71 or trades above daily pivot 147.16. While to the downside, the daily low of 146.66 and 146.6 (S1) as immediate support levels. USDJPY need to break on either side to indicate a short-term bias. A close below 146.66 would indicate selling pressure.

For the week to-date, take note that USDJPY is bearish as the pair posted lower by -0.18%.

Key levels to watch out: