USD/JPY falls as Hormuz reopening, risk mood hit US Dollar
- USD/JPY drops sharply after Iran announces that the Strait of Hormuz is fully open to commercial shipping.
- Improving risk sentiment reduces demand for the US Dollar as a safe-haven asset.
- Diverging monetary policy expectations between the US and Japan continue to shape market dynamics.
USD/JPY falls toward 158.20 at the time of writing, down 0.61% on Friday after hitting a daily high of 159.53 earlier. The pair now faces notable selling pressure as improving geopolitical conditions in the Middle East reduce demand for safe-haven US Dollar (USD).
The downward move accelerated after Iran’s Foreign Minister Abbas Araghchi announced that the passage of all commercial vessels through the Strait of Hormuz is now completely open for the remaining period of the ceasefire. He also explained that vessels will transit the strait via a coordinated route previously announced by the Ports and Maritime Organisation of Iran.
This announcement helps ease concerns about major disruptions to global energy flows, a risk that had previously supported the US Dollar amid heightened risk aversion and worries about Oil supply. The easing of geopolitical tensions is now weighing on the Greenback.
Meanwhile, diplomatic developments between Washington and Tehran remain closely watched by investors. US President Donald Trump recently stated that the United States (US) is close to reaching a deal with Iran, reinforcing hopes for a more durable de-escalation in the region.
On the Japanese side, the Japanese Yen (JPY) continues to be influenced by monetary policy expectations. Bank of Japan (BoJ) Governor Kazuo Ueda recently warned that Japan’s economy could face stagflation risks, with inflation driven by an energy-related supply shock alongside weaker economic growth. This environment could encourage the central bank to maintain a cautious stance regarding further interest rate hikes.
Analysts at Société Générale also note that expectations for monetary tightening in Japan have been scaled back, with the next rate hike now seen around June or July. In this context, JPY dynamics remain closely linked to policy expectations and interest rate differentials with the United States.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Canadian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.55% | -0.48% | -0.55% | -0.33% | -0.75% | -0.57% | -0.66% | |
| EUR | 0.55% | 0.06% | -0.04% | 0.19% | -0.22% | -0.04% | -0.14% | |
| GBP | 0.48% | -0.06% | -0.09% | 0.13% | -0.28% | -0.10% | -0.19% | |
| JPY | 0.55% | 0.04% | 0.09% | 0.22% | -0.20% | -0.04% | -0.12% | |
| CAD | 0.33% | -0.19% | -0.13% | -0.22% | -0.42% | -0.25% | -0.32% | |
| AUD | 0.75% | 0.22% | 0.28% | 0.20% | 0.42% | 0.17% | 0.08% | |
| NZD | 0.57% | 0.04% | 0.10% | 0.04% | 0.25% | -0.17% | -0.09% | |
| CHF | 0.66% | 0.14% | 0.19% | 0.12% | 0.32% | -0.08% | 0.09% |
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 US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).