USD/JPY: Seesaws around 108.00 amid broad US dollar strength
|- USD/JPY registers a three-day winning streak above 108.00.
- The King Dollar remains as the key beneficiary of the global rush to ward off coronavirus impact.
- The cases rise, more measures in the pipeline from the US, ECB announces a huge package.
- BOJ minutes, Japan’s National CPI can offer immediate direction, virus headlines keep the driver’s seat.
With the broad risk-aversion wave pumping the US dollar, USD/JPY remains on the front foot near 108.10, close to the three-week high, amid the initial Asian session on Thursday.
King Dollar cheers the rush to hoard cash…
With the multibillion-dollar stimulus packages out in every few hours, ECB’s 750 billion Euro bundle being the latest one, the rush to hoard cash in the US dollar remains strong.
The reason could be traced from the greenback’s status as the global reserve currency as well as joint efforts by the key global central bankers in the form of dollar-denominated swaps that have been helping the US currency off-late.
Speculations are also mounting that the Japanese government will soon reveal plans for its 30 trillion yen government stimulus package to counter the deadly virus.
That said, the risk-tone remains heavy despite the major fight against the coronavirus (COVID-19). The pandemic has so far infected 2,14,000 people across the globe with the latest outbreak being fierce in the UK and Italy.
Even so, the US 10-year treasury yields remain positive beyond 1.0% whereas equity futures consolidate losses after Wall Street continued the recent south-run by the end of their Wednesday’s trading session.
Investors will now concentrate on the BOJ minutes as well as Japan’s February month National Consumer Price Index (CPI) data for immediate direction. However, the virus updates and major attention will continue to be the key catalyst.
Technical Analysis
A sustained rise above late-January low near 109.30 can accelerate the north-run to 109.60 and 110.00 while the pair’s declines below October 2019 bottom surrounding 106.50 can trigger a fresh downside.
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