USD/JPY rebounds toward 107 as Wall Street turns red after US data
|- US Dollar Index recovers toward 100 handle in American session.
- CB Consumer Confidence in US dropped to 86.9 in April.
- Wall Street's main indexes pared early gains and fell into the negative territory.
The USD/JPY pair dropped to its lowest level since mid-March at 106.57 on Tuesday but staged a rebound during the American trading hours. As of writing, the pair was still down 0.3% on a daily basis at 106.90.
Disappointing US data helps USD gather strength
The data published by the Conference Board showed that Consumer Confidence Index plummeted to 86.9 in April from 118.8 in March to weigh on the market sentiment.
Assessing the data, consumers were less optimistic about their financial prospects and this could have repercussions for spending as the recovery takes hold," noted Lynn Franco, Senior Director of Economic Indicators at The Conference Board. "The uncertainty of the economic effects of COVID-19 will likely cause expectations to fluctuate in the months ahead.”
Other data from the US revealed that the international trade deficit widened to $64.22 billion in March and the Richmond Fed Manufacturing Index slumped to -53 in April from 2. After starting the day decisively higher, Wall Street's main indexes fell into the negative territory in the last hour and the greenback took advantage of the risk-off flows. The US Dollar Index, which fell below 99.50 earlier in the day, was last seen down 0.17% at 99.90.
There won't be any macroeconomic data releases featured in the Japanese economic docket on Wednesday and the risk perception is likely to remain as the sole driver of the pair's movements.
Technical levels to watch for
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