Geopolitical tensions in the Middle East drive safe-haven demand for the JPY, offsetting stronger-than-expected US jobs data.
The USD/JPY pair declined to near 156.60 on Friday as the Japanese Yen attracted safe-haven flows amid rising Middle East tensions. Reports of US airstrikes on tankers and Iranian warnings of a forceful response heightened market caution, supporting the JPY despite resilient US economic data.
US Nonfarm Payrolls added 115K jobs in April, surpassing expectations of 62K, while the Unemployment Rate held steady at 4.3%. Average Hourly Earnings rose 0.2% month-over-month, signaling easing wage pressures. The data underscored labor-market strength but did little to counter geopolitical-driven demand for the Yen.
Technical indicators showed USD/JPY trading below key moving averages, with a Relative Strength Index in the mid-40s, reflecting a muted but cautious market tone.