Key Characteristics of USD/JPY:

Volatility: USD/JPY often shows moderate to low volatility relative to some other major pairs, although it can experience significant movement in response to economic data and policy changes.

Economic Influences: The pair is highly sensitive to economic indicators from both the U.S. and Japan, including interest rate decisions by the U.S. Federal Reserve and the Bank of Japan (BoJ), inflation rates, GDP, and trade balances.

Interest Rate Differential: A key driver of USD/JPY is the interest rate differential between the two countries. The U.S. has maintained relatively high interest rates recently, while Japan has had ultra-low or negative rates, which often leads to a stronger dollar against the yen.

Global Sentiment and Safe-Haven Demand: The yen is often considered a "safe-haven" currency, meaning that during times of global risk or uncertainty, the yen may strengthen as investors seek safer assets. Conversely, during periods of risk-taking, the dollar typically strengthens relative to the yen.
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