Analysts at Rabobank share their short-term outlook for the USD/JPY pair following the latest developments.

USD/JPY to trade at lower levels later in the year

"While a break of USD/JPY152.00 may not trigger FX intervention immediately, we would see a strong chance of the MoF acting to prevent a move to 155.00. Strong US inflation data and soft Japanese economic numbers would increase the risk of the MoF being forced into taking action."

"On the assumption that the BoJ will be able to announce a second rate hike later this year and given the expectation that the Fed will be cutting rates in 2024, we expect USD/JPY to be trading at lower levels later in the year. However, we have raised our 1- and 3-month forecasts to 150.00 and 148.00 respectively from 148.00 and 146.00."