• USD bulls seemed unaffected by growing fears of a full-blown trade war.
• Signs of stability in financial markets weigh on JPY and remain supportive.
The greenback held firmer against its Japanese counterpart, helping the USD/JPY pair to build on overnight bullish breakthrough the 111.40 supply zone.
The pair, so far, has been trending higher since the beginning of this week and seemed unaffected by escalating trade tensions and global risk-aversion. Investors' perception that the US economy is better positioned to withstand any meaningful disruption to the global trade helped offset global risk-aversion and was seen underpinning the US Dollar.
The USD up-move was further supported by Wednesday's hotter-than-expected US PPI print, which showed that wholesale cost rose at the fastest yearly rate in almost seven years and reaffirmed prospects for at least two Fed rate hike moves by the end of this year.
The pair moved past the 112.00 handle and extended the bullish momentum on Thursday amid signs of stability in global financial markets, which was seen denting the Japanese Yen's safe-haven appeal. A mildly positive opening across European equity markets, coupled with a goodish pickup in the US Treasury bond yields reinforce improving market sentiment and remained supportive.
Moving ahead, today's release of the latest US consumer inflation figures might reinforce expectations of rising inflationary pressure in the economy and assist the pair to continue climbing higher in the near-term.
Omkar Godbole, Analyst and Editor at FXStreet writes: “The bullish breakout has opened the doors to 113.23 (200-week moving average).”
“A weekly close (Friday's close) below 111.00 would abort the bullish view,” he adds further.
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.