By contrast, Japan’s monetary policy remains ultra-loose, with the Bank of Japan (BoJ) maintaining its negative interest rates and yield curve control to stimulate growth and inflation. This divergence between loose monetary settings in Japan and tighter policies in the US is a significant driver behind the USD/JPY pair’s upward momentum.

Technically, USD/JPY has consolidated gains above the 146.00 level, facing resistance near 148.00. Momentum oscillators point to cautious bullishness, suggesting the pair may test key resistance levels if US economic fundamentals continue to improve.

Trade tensions, geopolitical developments, and global risk sentiment also influence the USD/JPY outlook. Risk-off sentiment typically sees the Yen gain due to its safe-haven status, while risk-on flows strengthen the Dollar.

Upcoming US economic releases, including retail sales, durable goods orders, and inflation data, will be critical in setting near-term USD/JPY direction. Investors are also wary of any shifts in BoJ rhetoric signaling adjustments to its accommodative stance.

Currency traders should anticipate volatility around these key events and monitor broader global uncertainties, such as energy prices and supply chain trends, which impact the economies of both countries.

In summary, the USD/JPY mid-day outlook remains cautiously bullish, supported by monetary policy divergence and US economic resilience but tempered by global uncertainties and potential Yen safe-haven flows.