USDJPY definition

USD/JPY is the exchange rate between the US dollar and the Japanese yen, showing how many yen one dollar will buy. It is the second most heavily traded currency pair in the world, at about 14.3% of the roughly $9.6 trillion that changes hands in the global forex market each day (BIS Triennial Survey, 2025), which gives it deep liquidity and consistently tight spreads. Some traders call it the gopher.

The US dollar is the base currency and the yen the quote currency, so a quote of 150.00 means one dollar is worth 150 yen. A rising price means the dollar is strengthening against the yen, a falling price the reverse. You trade USD/JPY as a forex CFD, taking a position on the price rather than owning yen outright: go long if you expect the dollar to rise, short if you expect it to fall. Because the yen is quoted to two decimal places, a pip here is the second decimal, and your result is the pips gained or lost multiplied by your position size.

The dominant force is the interest-rate gap between the Federal Reserve and the Bank of Japan, which has long held rates far below the Fed's; a wider gap pulls capital toward the dollar and lifts the pair. The yen is also a classic safe haven and a favourite funding currency for carry trades, so it tends to strengthen when global risk sentiment sours and money unwinds those positions, sending USD/JPY lower.