Due to the widespread tariff measures announced by Trump, which may affect the global economy, market risk aversion has sharply increased, driving the yen to strengthen and causing a significant decline in US Treasury yields. The 10-year US Treasury yield has fallen to 4.0%

The rise of the Japanese yen is mainly driven by the inflow of safe haven funds and the decline in US bond yields. The market's expectation of the Federal Reserve cutting interest rates has risen, further weakening the US dollar. "- John Hardy, Chief Macro Strategist of Saxo Bank

The interest rate differential between the United States and Japan is an important factor affecting the trend of the US dollar against the Japanese yen. Currently, with the decline in US bond yields and increasing market expectations for the Fed's interest rate cuts, the US Japan interest rate differential is gradually narrowing, driving the appreciation of the Japanese yen.

The market expects the Federal Reserve to cut interest rates in June and three times throughout the year. The 10-year Treasury yield has fallen to a new low for the year, weakening the attractiveness of the US dollar. Expectations of the Bank of Japan raising interest rates still exist, supporting the Japanese yen

Despite the market reassessing the rate at which the Bank of Japan is raising interest rates due to Trump's tariff policies, strong inflation data may still prompt it to adjust its policies in the future. "- Chris Turner, foreign exchange strategist at ING

From a technical perspective, the US dollar has fallen below the 100 period moving average against the Japanese yen and has lost its upward channel that has been in place for several weeks, indicating a high possibility of further weakening.

On a technical level, the short-term trend of the US dollar against the Japanese yen is bearish. If it further falls below 147.00, it may accelerate its exploration into the 146.50 area. "- Kyle Rodda, Senior Analyst at Capital.com

Editor's viewpoint:

Driven by global risk aversion, the Japanese yen continues to strengthen, while the narrowing of the US Japan interest rate differential and the increasing expectation of Fed interest rate cuts further strengthen the downward trend of the USD/JPY. In the short term, the US dollar against the Japanese yen may continue to decline to the level of 146.50, but attention should be paid to the latest stance of the Bank of Japan and policy adjustments by the Federal Reserve.

If the market's risk aversion continues, the Japanese yen may be expected to test the 145.80 area.