The exchange rate for USD/JPY declines to around 156.85 during Thursday’s Asian session. Israel has launched a new wave of strikes in Iran, raising worries about a prolonged conflict. The US ISM Services PMI has hit its highest level since July 2022. The currency pair is currently trading in the red at approximately 156.85 during the Asian session on Thursday. The ongoing tensions in the Middle East are prompting a flight to safety, resulting in a stronger performance of the Japanese Yen relative to the US Dollar. The Initial Jobless Claims report for the US will be released later on Thursday.
Israel’s military has announced the start of a new wave of strikes targeting military infrastructure in Tehran. Previously, the chairman of the Joint Chiefs of Staff indicated that the US will begin “striking progressively deeper” into Iran. Worries about a prolonged conflict in the Middle East could drive more attention towards a safe asset such as gold. Bank of Japan Governor Kazuo Ueda stated on Wednesday that he will monitor the effects of developments in the Middle East on both the domestic and international economy.
Meanwhile, Finance Minister Satsuki Katayama indicated that he is attentively observing market trends and is prepared to take action if needed. In February, the US service sector saw an increase in economic activity, which could enhance the value of the currency against the JPY. The US ISM Services PMI rose to 56.1 in February, up from 53.8 earlier. This figure surpassed the anticipated 53.5.