Yen about to mark weekly loss on hopes for trade negotiations success

The Japanese yen fell in Asian trade on Friday against a basket of major  rivals, moving in a negative zone against the dollar and about to mark the first weekly loss in a month on hopes for the success of trade negotiations between the US and its major trade partners.

According to some reports, Washington has already achieved progress in early trade talks with Japan and South Korea, while China is considering tariff exemptions for some US products.

Recent Tokyo inflation data showed prices accelerated for the second straight month, in turn boosting inflationary pressures on the Bank of Japan.

The Price

The USD/JPY price rose 0.6% today to 143.45 yen per dollar, with a session-low at 142.56.

The yen rose 0.6% on Thursday against the dollar, marking the first profit in three days as investors assessed the trade risks amid mixed signals from the Trump administration.

Weekly Trades

The yen is down 1% so far against the dollar this week, on track for the first weekly loss in a month.

Trade Talks

It looks like some progress was achieved in trade talks between the US and its two Asian allies, Japan and South Korea.

Japan’s finance minister said after meeting US Treasury Secretary Scott Bessent that no talks were conducted about forex targets, after Trump recently accused Tokyo of deliberately weakening its currency to boost exports.

Otherwise, the South Korean mission sai on Thursday after an initial round of talks that both sides are seeking a clear framework before removing the reciprocal tariffs in July.

Tokyo Inflation

Earlier Tokyo data showed main consumer prices rose 3.4% in April, passing estimates of 3.2%, and up from 2.4% in March.

It’s a clear sign that prices are maintaining their upward momentum, which boosts the odds of a Japanese interest rate hike later this year.

Ueda

Bank of Japan Kazuo Ueda said the bank will continue to raise interest rates if inflation approaches the 2% target as expected.

However, he added the central bank will look closely into how various data, and how the ramifications of US tariffs, would impact this price target.

A senior official at the International Monetary Fund stated earlier this week that the Bank of Japan will likely put off the timing of new interest rate hikes due to uncertainty about US tariffs.