USD/JPY under pressure as Japan's composite PMI surges to 53.8

USD/JPY faces downward pressure following stronger-than-expected Japanese flash PMI data for February, which bolstered the case for continued Bank of Japan policy normalization. Japan's composite PMI rose to 53.8, marking a solid expansion in private sector activity, while the manufacturing PMI also gained momentum, signaling a broadening recovery. Export orders surged, reflecting robust global demand for Japanese goods and improving trade dynamics. The data reinforces expectations that the BOJ may proceed with further interest rate adjustments in the coming months, particularly as wage growth and inflation remain elevated. The stronger PMI readings contrast with softening economic indicators in other major economies, providing the yen with a relative advantage. Traders should monitor the 149.50 support level on USD/JPY, with a break below potentially opening a move toward the 148.80 zone. Resistance sits near 150.50. The combination of improving Japanese fundamentals and potential BOJ hawkishness creates a supportive backdrop for yen strength in the near term.