- AUD/JPY extends the previous week’s gain on Tuesday
- AUD gains across the board after RBA maintained its status quo on interest rates.
- Yen remains under pressure on rising corona infections and extension of lockdown ahead of summer Olympics.
AUD/JPY holds onto the initial gains on Tuesday in the early European trading hours. The pair touched the intraday high in the vicinity of 84.0 and manages to preserve the upside momentum following the Reserve Bank of Australia (RBA) interest rate decision.
At the time of writing, AUD/JPY is trading at 83.79, up 0.30% for the day.
The Reserve Bank of Australia (RBA) kept its official cash rate (OCR)unchanged at a record low of 0.10% in its July monetary policy meeting.
The market already discounted the RBA's decision and expected nothing new will be offered in the meeting. The only key takeaway is that the RBA is planning another round of bond purchases beyond the completion date in September.
In addition to that, the ongoing tensions between China and Australia came up with another blowout after Beijing accused its counterpart of COVID-19 vaccine sabotage in Asia-pacific keeps pressure on the aussie.
On the economic side, the Australian AiG Construction PMI dropped to 55.5 in June from 58.3 in the previous month. The Retails Sales rose 0.4% in June compared to 1.1% growth in the prior month.
On the other hand, the yen gained on its safe-haven appeal amid rising coronavirus infection globally due to the Delta variant and threatening the pace of economic recovery.
In the latest development, the Japanese government is set to extend its quasi-state of emergence in Tokyo during the Summer Olympics. A slower vaccination rollout program and lockdown restriction kept the currency gains limited
The sentiment further soured following the downbeat economic data. Household Spending in Japan jumped 11.6% in May, though the pace of growth slowed from the previous month from a 13% gain.
As for now, the market dynamics continue to influence the pair’s performance for the time being.
AUD/JPY additional levels
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Recommended content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.