Technical Analysis of the Japanese Yen Index
The Japanese Yen Index continues to move in a downward trend on the weekly and daily timeframes. Currently, the bearish bias has also begun to dominate the 4hour chart. Prices have already bounced from the 734 level, as mentioned in our previous report. At present, prices are trading around the 731 level, and the bearish trend is expected to continue throughout the day.

Key Economic News
Despite limited signs of recovery, Japan continues to face mounting economic pressures. The economy recorded slight growth in Q2 2025, yet the industrial sector remained weak, dragged down by declining export orders and reduced shipments due to U.S. trade restrictions. Public debt remains at historically high levels above 230% of GDP, constraining fiscal flexibility. On the currency front, the wide interest rate gap with the United States keeps the yen under sustained pressure; although the Bank of Japan raised rates to 0.5%, Japanese yields remain far below U.S. levels, boosting the dollar’s appeal. Political uncertainty at home adds further volatility, leaving the outlook tied to export performance and the timing of the BoJ’s next policy move.

Liquidity Levels
Prices are expected to decline further, targeting 728.0, then 724.0, and 718.0.

Invalidation Scenario
The bearish outlook is invalidated if prices revisit the 748.0 level.