USD/JPY sticks to daily lows, eyes 109.50
|- USD/JPY slides below 110 on the back of dollar weakness.
- Market sentiment is downbeat, benefiting the safe-haven status of the Japanese yen vs the greenback.
- On Thursday, the US Jobless Claims and the Retail Sales will be released.
After posting a three-day high during the Asian session, the USD/JPY turned around and is trading around 109.59, down 0.33% on the day, on broad US dollar weakness. The greenback has been dragged by a fall of 3.46% in the US 10-year benchmark rate.
The market sentiment remains in risk-off mode, so the market dumps everything with the “risk” word attached, benefiting the Japanese yen. The US 10-year Treasury yield, which positively correlates with the USD/JPY pair, is down in the session four basis points, currently at 1.284%. Meanwhile, the US dollar index is down 0.10%, trading at 92.51.
US inflation figures prompted a dollar sell-off
In the US, the Core Consumer Price Index in August rose 4% against 4.3% foreseen by economists. It is the slowest pace in six months, insinuating that inflation has potentially peaked. This reaffirms the Fed’s “transitory” thesis. Nevertheless, despite waning inflation, supply chain disruptions and semiconductor chip shortages remain in play and could exert inflationary pressures.
That said, if the "transitory" theory of price rises takes hold, the US dollar could continue its downtrend. Retail Sales figures for August and consumer confidence data for September are due this week.
KEY TECHNICAL LEVELS
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.