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The USD/JPY pair catches fresh bids at the start of a new week and climbs back closer to last week’s swing high, though it lacks follow-through and remains below the 157.00 mark through the Asian session. A coordinated US-Israel military strike on Iran marks a dramatic escalation of geopolitical tensions and unsettles global markets. Adding to this, concerns that the closure of the Strait of Hormuz – a critical maritime chokepoint – could push up oil prices and trigger a global economic downturn boost the US Dollar’s (USD) status as the global reserve currency. This turns out to be a key factor acting as a tailwind for the USD/JPY pair. Meanwhile, the global flight to safety, along with expectations that the Bank of Japan (BoJ) will stick to its policy normalization path, offers some support to the Japanese Yen (JPY). Furthermore, fears that authorities would step in to stem further JPY fall act as a headwind for the USD/JPY pair. This, in turn, warrants some caution before placing aggressive bullish bets and positioning for any further appreciation for the currency pair. Risk sentiment FAQs In the world of financial jargon the two widely used terms “risk-on” and “risk off” refer to the level of risk that investors are willing to stomach during the period referenced. In a “risk-on” market, investors are optimistic about the future and more willing to buy risky assets. In a “risk-off” market investors start to ‘play it safe’ because they are worried about the future, and therefore buy less risky assets that are more certain of bringing a return, even if it is relatively modest. Typically, during periods of “risk-on”, stock markets will rise, most commodities – except Gold – will also gain in value, since they benefit from a positive growth outlook. The currencies of…

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Filed under: News - @ March 2, 2026 1:47 am