USD/JPY faces pressure as BoJ rate hike expectations intensify

USD/JPY has retreated to 151.20, down 0.4% (60 pips) as markets price in a potential Bank of Japan rate hike at the upcoming December meeting. Growing speculation about the BoJ ending its ultra-loose monetary policy has renewed focus on unwinding yen carry trades, which could trigger significant volatility. Japan's 10-year bond yields have risen to multi-year highs, reflecting changing rate expectations. The Nikkei 225 has declined 1.2% amid concerns about the impact on exporters. Technical indicators show USD/JPY approaching critical support at 150.80, with a break below potentially accelerating losses toward 149.50. Resistance sits at 152.00, coinciding with the 50-day moving average. Traders are closely monitoring BoJ Governor Ueda's comments and upcoming inflation data, which could determine whether the central bank moves away from negative rates, potentially strengthening the yen further against the dollar.