- AUD/JPY drifts lower for the third successive day and drops to a multi-week low.
- Hawkish remarks by RBA’s Bullock boost the Aussie and lend support to the cross.
- Bets for another BoJ rate hike in 2024 underpin the JPY and cap any further gains.
The AUD/JPY cross remains under some selling pressure for the third successive day on Thursday and drops to a three-and-half-week low during the Asian session on Thursday. Spot prices currently trade just below mid-96.00s and seem vulnerable to prolong this week's rejection slide from the key 200-day Simple Moving Average (SMA).
The Australian Dollar (AUD) did get a minor lift following Reserve Bank of Australia (RBA) Governor Michele Bullock's hawkish remarks, saying that the board remains vigilant to upside risks to inflation and does not expect to be in a position to cut rates in the near term. That said, unimpressive Australian Trade Balance data, showing that the surplus rose to A$6,009 million in July amid a 0.8% fall in imports and a 7% increase in exports, keeps a lid on any meaningful appreciating move.
Apart from this, expectations that the Bank of Japan (BoJ) will hike rates again in 2024, bolstered by data showing that real wages in Japan rose for the second straight month in July, continue to underpin the Japanese Yen (JPY) and further contribute to capping the upside for the AUD/JPY cross. Moreover, BoJ Board Member Hajime Takata said that the central bank must adjust monetary conditions by another gear if it can confirm that firms will continue to increase capital expenditure, wages, and prices.
Meanwhile, the cautious market mood is seen as another factor benefitting the JPY's relative safe-haven status against its Australian counterpart. This, in turn, suggests that the path of least resistance for the AUD/JPY cross is to the downside and suggests that the the recent goodish recovery move from the vicinity of the 90.00 psychological mark, or over a one-year low touched in August has run out of steam already.
Economic Indicator
RBA Governor Bullock speech
Michele Bullock is the the ninth Governor of the Reserve Bank of Australia. She commenced her current position in September 2023, replacing Philip Lowe. Bullock was the Assistant Governor (Financial System) at the Reserve Bank of Australia, a position she held since October 2016.
Read more.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD recovers above 1.0950 on US Dollar weakness
EUR/USD is recovering further ground above 1.0850 in early Europe on Tuesday amid a broadly weaker US Dollar. The recovery in risk sentiment undermines the havem demand for the US Dollar, lifting the pair. Dovish Fed expectations also weigh negatively on the Greenback. Tariff updates eyed.
GBP/USD: Upside remains capped below 1.2800
GBP/USD is consolidating its rebound to near 1.2800 in Tuesday's European morning. The pair draws support from renewed US Dollar weakness and a positive shift in risk sentiment but US President Trump's tariff war and global growth concerns limit its upside.
Gold price climbs further beyond $3,000 amid trade jitters, renewed USD selling
Gold price builds on the previous day's late rebound from a nearly four-week low and climbs back above the $3,000 psychological mark heading into the European session on Tuesday. Persistent worries about an all-out global trade war help revive demand for the safe-haven bullion.
XRP battles tariff turbulence amid MVRV buy signal
Ripple seeks stability in a volatile crypto landscape influenced by macroeconomic factors, including reciprocal tariffs. The international money transfer token hit a low of $1.64 on Monday after opening the week at $1.92, representing a 14.5% daily drop.
Strategic implications of “Liberation Day”
Liberation Day in the United States came with extremely protectionist and inward-looking tariff policy aimed at just about all U.S. trading partners. In this report, we outline some of the more strategic implications of Liberation Day and developments we will be paying close attention to going forward.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.