No major events are expected today.

USD/JPY is trading around 157.90 after retreating from recent highs. The Bank of Japan kept the short-term rate at 0.75% but again highlighted inflation risks linked to expensive oil and a weak yen. For Japan’s fuel-import-dependent economy, this reinforces expectations of further rate hikes.

Additional support for the yen comes from authorities’ statements about readiness to respond to excessive currency market fluctuations. The closer the dollar approaches the 160-yen area, the greater the concerns about possible intervention. As a result, some participants prefer to reduce their purchases of the pair, even despite higher rates in the U.S.

The Federal Reserve left its rate unchanged and does not promise quick easing. For USD/JPY, this factor is largely already priced in. Currently, the focus is on the Bank of Japan’s next steps and the risk of authorities reacting to yen weakness, making a decline in the pair more likely.

Recommendation: SELL 157.90, SL 158.35, TP 156.55