The headline Tokyo Consumer Price Index (CPI) for May rose 1.4% YoY as compared to 1.5% in the previous month, the Statistics Bureau of Japan showed on Friday.
Additionally, Tokyo CPI ex Fresh Food climbed 1.3% YoY in May against 1.5% expected and 1.5% in the prior month. The Tokyo CPI ex Fresh Food, Energy rose 1.6% YoY in May, compared to the previous reading of 1.9%.
USD/JPY reaction to the Tokyo Consumer Price Index data
As of writing, the USD/JPY pair is down 0.17% on the day at 159.25.
Japanese Yen Price Today
The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the weakest against the New Zealand Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.22% | -0.13% | -0.16% | -0.41% | -0.30% | -0.71% | -0.41% | |
| EUR | 0.22% | 0.09% | 0.02% | -0.20% | -0.10% | -0.47% | -0.20% | |
| GBP | 0.13% | -0.09% | -0.04% | -0.29% | -0.17% | -0.54% | -0.30% | |
| JPY | 0.16% | -0.02% | 0.04% | -0.25% | -0.13% | -0.55% | -0.25% | |
| CAD | 0.41% | 0.20% | 0.29% | 0.25% | 0.12% | -0.29% | -0.01% | |
| AUD | 0.30% | 0.10% | 0.17% | 0.13% | -0.12% | -0.39% | -0.13% | |
| NZD | 0.71% | 0.47% | 0.54% | 0.55% | 0.29% | 0.39% | 0.27% | |
| CHF | 0.41% | 0.20% | 0.30% | 0.25% | 0.00% | 0.13% | -0.27% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).
This section below was published as a preview of the Japan’s Tokyo Consumer Price Index data at 21:27 GMT.
- Tokyo Consumer Price Index (CPI) for May lands at 23:30 GMT Thursday, the Yen’s last meaningful catalyst before the weekend.
- April’s print missed across every measure, pushing June rate hike pricing further out.
- The data is now the Yen’s primary lever short of another intervention.
The Bank of Japan (BoJ) has effectively outsourced its next policy decision to the statistics bureau. After two intervention rounds reportedly totaling more than $60 billion in late April and early May, USD/JPY has already clawed back roughly 80% of those declines and now trades near 159.20, well within reach of the politically sensitive 160.00 handle. Governor Kazuo Ueda’s recent rhetoric has done little to slow the grind higher, and traders increasingly read his comments as warnings rather than commitments. That leaves Tokyo CPI as the single remaining catalyst capable of forcing a rethink without another check from the Ministry of Finance.
The April miss is still doing the damage
Last month’s Tokyo CPI print came in soft across every measure that mattered. Headline at 1.5% YoY, core ex-fresh-food at 1.5% YoY, and the closely watched core-core reading (ex-fresh-food and energy) collapsing to 1.9% YoY against a 2.3% consensus. That core-core slide was the print’s most consequential element, the slowest pace since March 2022 and a third consecutive month below the BoJ’s 2% target. Rate markets reacted immediately, pushing June hike probabilities further out and stripping the Yen of one of its few non-intervention supports.
Consensus for May has the headline ex-fresh-food measure holding flat at 1.5% YoY. That alone tells you what positioning desks expect.
Why carry traders aren’t sweating
The Yen carry trade is currently funded by a roughly 300 basis point differential between the Federal Reserve’s (Fed) 3.50% to 3.75% target range and the BoJ’s 0.75% policy rate. Every day Tokyo CPI fails to surprise to the upside is another day that math holds, and another day positioning rebuilds toward levels seen before the April 30 intervention. The asymmetry sits firmly with the carry trader. A miss confirms the playbook. A beat creates noise, but a single Tokyo print has never been enough to force a hike Ueda does not want to deliver.
The data would need to surprise meaningfully across both headline and core-core measures, ideally on the back of a clear reacceleration in services inflation, to genuinely shift the policy timeline rather than briefly rattle positioning.
The chart agrees with the macro
Daily structure shows the pair trading above the 50-period Exponential Moving Average (EMA) near 158.50, with the 200 EMA further below close to 155.50. The Stochastic Relative Strength Index (Stoch RSI) on the daily chart is climbing through the upper band and approaching overbought, hinting at near-term exhaustion without yet flashing reversal. Intraday price has slipped from 159.65 to around 159.20 ahead of the print, suggesting some pre-event position trimming rather than fresh selling pressure.
The 160.00 handle remains the line the Ministry of Finance has clearly drawn. The 158.50 area below acts as first support, and a clean break opens 156.00 again.
Data preview: scenarios that matter
- A consensus-aligned print, with headline ex-fresh-food holding at 1.5% YoY and core-core near 1.9%, likely sees the Yen drift weaker and brings the test of 160.00 forward into next week.
- A meaningful miss, with headline closer to 1.3% and core-core under 1.8%, effectively closes the book on June hike pricing. The pair grinds through 160.00, and Tokyo’s next intervention decision moves up the calendar.
- A genuine upside surprise, with headline above 1.7% and core-core back near or above 2.1%, is the cleanest Yen-positive setup available this week and reopens credible June or July hike pricing. The pair retreats toward 158.50 quickly and forces a real rethink of positioning into the BoJ’s June meeting.
Bias
The path of least resistance stays higher unless Tokyo CPI delivers an upside surprise broad enough to force a genuine repricing of the BoJ’s near-term hike path. Until then, dips remain bids, and the Yen’s fate stays in the hands of a statistics bureau the BoJ should have been listening to all along.
USD/JPY 15-minute chart
Bank of Japan FAQs
The Bank of Japan (BoJ) is the Japanese central bank, which sets monetary policy in the country. Its mandate is to issue banknotes and carry out currency and monetary control to ensure price stability, which means an inflation target of around 2%.
The Bank of Japan embarked in an ultra-loose monetary policy in 2013 in order to stimulate the economy and fuel inflation amid a low-inflationary environment. The bank’s policy is based on Quantitative and Qualitative Easing (QQE), or printing notes to buy assets such as government or corporate bonds to provide liquidity. In 2016, the bank doubled down on its strategy and further loosened policy by first introducing negative interest rates and then directly controlling the yield of its 10-year government bonds. In March 2024, the BoJ lifted interest rates, effectively retreating from the ultra-loose monetary policy stance.
The Bank’s massive stimulus caused the Yen to depreciate against its main currency peers. This process exacerbated in 2022 and 2023 due to an increasing policy divergence between the Bank of Japan and other main central banks, which opted to increase interest rates sharply to fight decades-high levels of inflation. The BoJ’s policy led to a widening differential with other currencies, dragging down the value of the Yen. This trend partly reversed in 2024, when the BoJ decided to abandon its ultra-loose policy stance.
A weaker Yen and the spike in global energy prices led to an increase in Japanese inflation, which exceeded the BoJ’s 2% target. The prospect of rising salaries in the country – a key element fuelling inflation – also contributed to the move.
