USD/JPY rallies to 144.50 as BoJ policy uncertainty weakens yen

USD/JPY has surged 0.9% to 144.50, marking the pair's strongest level in two weeks as concerns over Bank of Japan policy normalization weigh on the yen. Market participants are reassessing the BoJ's commitment to tightening after recent comments from board members suggesting patience in removing accommodation. The move accelerated after breaking above key resistance at 143.80, with momentum indicators turning bullish. Japanese 10-year yields remain anchored near 0.65%, failing to provide support for the currency despite the BoJ's policy adjustments. Technical analysis reveals next resistance at 145.00, a psychologically important level that coincides with the 50-day moving average. Support has shifted to 143.50, the former resistance level. Traders are positioning for potential further yen weakness ahead of Friday's Japanese CPI data, which could influence the BoJ's policy trajectory. The divergence between Fed and BoJ policies continues to favor USD/JPY upside in the near term.