Japanese Yen and Aussie Dollar Forecasts: Key Data to Impact BoJ and RBA Moves

Japan Producer Prices to Signal Inflation Trends

Japan’s producer price data will take center stage on Wednesday, May 14, influencing the USD/JPY trajectory and Bank of Japan policy stance. Economists expect producer prices to rise 4% year-on-year in April, down from 4.2% in March.

A weaker-than-expected reading could signal softening demand, potentially dampening inflationary pressures. Producers typically lower prices as demand weakens, passing cost savings on to customers. A lower inflation outlook would align with the BoJ’s recent downward revision to inflation and GDP, reinforcing a less hawkish policy outlook.

Conversely, a higher reading may renew bets on a Q3 2025 BoJ rate hike, boosting Japanese Yen demand.

USD/JPY Daily Outlook: Watching Fed Cues

Trade developments will continue driving Yen appetite. Easing global trade tensions may curb safe haven flows into the Yen. However, rising geopolitical tensions could impact market sentiment, boosting Yen appetite.

During the US session, traders should track Fed signals. A hawkish Fed stance, supporting a near-term policy hold, could lift US dollar demand and drive USD/JPY toward 150. On the other hand, growing support for rate cuts, especially after recent tariff developments, could weigh on the greenback, sending USD/JPY toward 145.

USD/JPY: Key Scenarios to Watch

• Bearish USD/JPY Scenario: Escalating trade tensions, hotter producer prices, or hawkish BoJ guidance may drag USD/JPY toward the 50-day EMA and 145.
• Bullish USD/JPY Scenario: Easing trade tensions, softer producer prices, or dovish BoJ signals may support a move toward the 149.358 resistance level and the 200-day EMA.

See today’s full USD/JPY forecast with chart setups and trade ideas.

AUD/USD in Focus: Labor Market Data to Guide RBA Expectations

On May 15, focus shifts to the upcoming Aussie labor market data, potentially affecting AUD/USD trends. Economists forecast a steady unemployment rate at 4.1% in April. Additionally, economists expect full employment to rise, signaling a robust labor market.

Tighter labor market conditions could spur wage growth and consumer spending, potentially fueling inflation. A higher inflation outlook may ease bets on multiple 2025 RBA rate cuts and support Aussie dollar demand. Conversely, rising unemployment and falling full employment may support a more dovish RBA stance, weighing on the Aussie dollar.

Shane Oliver, Head of Investment Strategy and Chief Economist at AMP, remarked on the potential RBA rate path after the US-China trade war truce, stating:

“Following the US/China 90 day tariff cuts money market expectations have fallen back to around 3.3 more 0.25% RBA rate cuts this year (down from around 5 back in early April), but with a 0.25% cut 99% priced in for next week.”

AUD/USD: Key Scenarios to Watch

• Bearish Aussie dollar Scenario: Renewed US-China tensions, rising Aussie unemployment, or dovish RBA cues may send AUD/USD below the 200-day EMA toward the $0.63623 support level and the 50-day EMA.
• Bullish Aussie dollar Scenario: Upbeat trade developments, Beijing stimulus, falling Aussie unemployment, or hawkish RBA guidance could drive the pair above the May 7 high of $0.65144.

Click here for a more comprehensive analysis of AUD/USD trends and trade data insights.

Aussie Dollar Daily Outlook: Fed Commentary to Steer US-Aussie Yield Differentials

Later today, Fed speakers may influence cross-currency rate dynamics. Hawkish Fed cues, signaling a near-term hold on policy moves, could widen the rate differential in favor of the US dollar, sending the AUD/USD pair below the 200-day EMA toward the 0.63623 support level and the 50-day EMA.

However, rising support for a June Fed rate cut may narrow the rate differential, favoring the Aussie dollar. A more dovish Fed stance could drive AUD/USD toward $0.65144.

Key Market Drivers to Watch Today:

• USD/JPY: US-Japan trade talks, Producer Price trends, and BoJ commentary.
• USD/JPY and AUD/USD: Fed forward guidance and global trade developments.
• AUD/USD: US-China trade headlines, Aussie labor market data, RBA signals, and Beijing stimulus-related updates.

For more in-depth analysis, review today’s USD/JPY and AUD/USD trading setups in our latest reports.