USD/JPY slightly offered in the open, eyes on coronavirus headlines
|- USD/JPY is stuck in a tight range as sleepy holiday markets start to wake.
- Risk-off is likely to keep interest high in both currencies, separately.
The yen has picked up a start of the week bid across the board, moving up against the US dollar by 5 pips to a low of 107.42 from high of 107.47, falling further away from the end of week 107.50s.
The market was quiet on Friday pertaining to the US holiday and the pair stuck toa tight range in the 107.50s.
To start the week, COVID-19 headlines are doing the rounds. US case numbers are rising rapidly in Texas and Florida and across the US have exceeded 50,000 per day every day in July.
More on these details with the following article: What you need to know for the open: Summer lull or a COVID-19 tidal wave of panic-vol?
Meanwhile, we can expect the pair to remain anchored as both currencies battle it out for their safe-haven allure and trading in narrow ranges could be the playbook for the day ahead on a relatively quiet calendar to start with.
Things, on the data front, will not likely get interesting until US Non-manufacturing ISM up first ahead of Jobless Claims. "The index probably rose above the break-even 50 level as the economy "reopened," similar to the pattern already reported for manufacturing," analysts at TD Securities explained...
Of course, modest growth after a plunge implies a sizable net decline. Also, the recovery is being threatened by the renewed uptrend in COVID cases. A reversal of reopenings is more likely for services than for manufacturing businesses.
Besides these data, the focus will be on coronavirus as world leaders grappling with the issue of when to wean businesses and individuals off the support lines. It will be a testing time for investor risk appetites and the stock markets, which will likely be the main driver of the yen for the week ahead.
USD/JPY levels
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