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Goldman Sees Yen Rising to Low 140s as Bitcoin Echoes Tech Stock Weakness

Goldman Sachs recommends the yen as a hedge against U.S. recession risks, citing its historical strength in risk-off environments.

By Omkar Godbole
Updated Apr 2, 2025, 9:26 a.m. Published Apr 2, 2025, 7:26 a.m.
Goldman cites Japanese yen as top hedge against U.S. tariffs, recession. (happylism/Pixabay)
Goldman cites Japanese yen as top hedge against U.S. tariffs, recession. (happylism/Pixabay)

What to know:

  • Bitcoin fell 1% against the Japanese yen after failing to break key trendline resistance.
  • Goldman Sachs recommends the yen as a hedge against U.S. recession risks, citing its historical strength in risk-off environments.
  • Tariff uncertainties have increased recession fears, with potential impacts on both equities and cryptocurrency markets.

The Bitcoin-Japanese yen (BTC/JPY) pair faced a setback at key trendline resistance Wednesday, as Goldman Sachs (GS) cited the anti-risk yen as the leading hedge against rising U.S. tariff and recession risks.

The BTC/JPY trading on the Japan-based bitFlyer fell 1% after failing to take out the trendline drawn off the record high reached on Jan. 20, data from charting platform TradingView show.

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BTC's USD-denominated price faced similar losses. Meanwhile, Asian equity indices and the U.S. equity futures treaded water ahead of President Donald Trump's sweeping new “Liberation Day” reciprocal tariffs on Wednesday that could trigger a global trade war.

The tariff uncertainty has spurred several investment banks, including JPMorgan and Goldman Sachs, pencil in a higher chance of U.S. recession or consecutive quarterly contractions in the growth rate.

Some crypto observers expect investors to treat bitcoin (BTC) as a haven asset should a tariff-led economic swoon materialize. Goldman, however, sees the Japanese yen, a long-preferred safe haven, as the top hedge against U.S. risks.

"The yen offers investors the best currency hedge should the chances of a US recession increase," Kamakshya Trivedi, head of global foreign exchange, interest rates and emerging market strategy at Goldman Sachs, said late Tuesday, according to Bloomberg.

Trivedi added that the yen is also a "very good hedge" against U.S. labor market weakness and tends to do best when U.S. real rates [inflation-adjusted yields] and U.S. equities fall together.

BTC/JPY pressing against the downtrend line. (TradingView/CoinDesk)
BTC/JPY pressing against the downtrend line. (TradingView/CoinDesk)

While BTC is widely seen as a digital gold or haven asset by crypto market participants, the cryptocurrency has historically moved in tandem with technology stocks. In other words, tariffs-led risk-off on Wall Street could spill over into the crypto market.

Additionally, the yen's strength could prompt the unwinding of risk-on bullish trades financed by inexpensive yen-denominated loans, contributing to overall risk aversion in financial markets. The crypto market experienced this in early August last year when the yen carry trade unravelled, leading to declines in both stocks and BTC. During that period, bitcoin plummeted from approximately $65K to $50K within a week.

Goldman expects the Japanese yen to rise to the low 140s against the U.S. dollar this year. The USD/JPY pair traded at 149.77 at press time. The exchange rate is known to closely track the differential between yields on the 10-year U.S. and Japanese bonds.

The latter recently dropped to its lowest since August 2022, offering yen-bullish cues.

U.S.-Japan 10-year bond yield differential. (TradingView/CoinDesk)
U.S.-Japan 10-year bond yield differential. (TradingView/CoinDesk)
BitcoinyenGoldman ScahsrecessionMarkets
Omkar Godbole

Omkar Godbole is a Co-Managing Editor on CoinDesk's Markets team based in Mumbai, holds a masters degree in Finance and a Chartered Market Technician (CMT) member. Omkar previously worked at FXStreet, writing research on currency markets and as fundamental analyst at currency and commodities desk at Mumbai-based brokerage houses. Omkar holds small amounts of bitcoin, ether, BitTorrent, tron and dot.

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