Japan’s first-quarter GDP growth exceeds forecasts, bolstering the yen amid Fed hawkishness and intervention risks.
USD/JPY stabilizes around 159.05, halting a seven-day rally as Japan’s stronger-than-expected economic growth supports the yen. First-quarter GDP rose 0.5% quarterly and 2.1% annualized, surpassing estimates of 0.4% and 1.7%, respectively.
The data underscores resilience in Japan’s economy, though analysts warn higher energy costs may dampen future activity. Meanwhile, concerns over potential yen intervention by Japanese authorities cap further upside for USD/JPY, with Finance Minister Satsuki Katayama reaffirming readiness to act against excessive volatility.
Despite the yen’s support, elevated US Treasury yields and carry trade demand continue to limit its gains. The yield gap between US and Japanese bonds remains a key headwind for the currency pair.