USD/JPY Analysis · USD/JPY
USD/JPY and Interest Rate Differentials
1 min readEvergreen guide
How US–Japan yield differences, Bank of Japan policy and intervention risk shape USD/JPY.
Yield differentials
USD/JPY is sensitive to the gap between US and Japanese interest rates. A wider gap in favour of the US has historically tended to support the pair, though this is not guaranteed.
Intervention risk
Japan's Ministry of Finance has intervened in currency markets at times of rapid yen moves. Intervention can cause very sharp reversals.
Pip value note
JPY pairs use 0.01 as a pip. Use the pip calculator with the correct conversion rate for your account currency.
This content is for educational purposes only and is not investment advice or a recommendation to buy or sell any instrument. Trading involves a high risk of loss.