The Japanese yen continues to remain in the spotlight. According to the Bank of Japan's Tankan survey, business confidence among large manufacturers improved for the first time in two quarters during the April–June period. Additionally, companies expect consumer prices to remain above the central bank's 2% annual target over the next five years. These findings reinforce the need for further interest rate hikes by the Bank of Japan and serve as a key factor supporting the yen.

At the same time, yen bulls are largely ignoring warnings from U.S. President Donald Trump about the possible introduction of additional tariffs on Japanese goods—measures that Japan's chief trade negotiator, Ryosei Akazawa, believes could seriously harm the country's economy. Despite market optimism, demand for the safe-haven East Asian currency remains strong. On the other hand, the U.S. dollar is hovering near multi-year lows amid expectations that the Federal Reserve will resume its interest rate cutting cycle before the end of the year. This gives the low-yielding yen a further advantage and keeps the USD/JPY pair in a downtrend around the 143.00 level.

Technical Outlook: Intraday declines below the psychological level of 143.00—following a recent break below the 200-period Simple Moving Average (SMA) on the 4-hour chart—can be viewed as a key bearish trigger. Moreover, oscillators on the 4-hour timeframe are in negative territory, suggesting the potential for a further drop toward the 142.75 level.

On the other hand, the 143.75 level is capping recovery attempts. Any further upside may offer new selling opportunities and is likely to be limited near the 144.00 round number. Above this level, the 200-period SMA on the 4-hour chart, currently near the 144.40 level, may act as a strong resistance. However, a sustained break above this zone could trigger a short-covering rally, allowing spot prices to retest the psychological 145.00 level.