USD/JPY: Clings to 108.80 level as USD rebounds
- USD/JPY is consolidating near 108.80 level in the early Asian session.
- US Treasury yields lift the demand of the US dollar.
- Extension of coronavirus lockdown weighs on yen.
The appreciative move in the US dollar Index (DXY), keeps the USD/JPY afloat in the early Asian session. The pair trades on a subdued note around the 108.80 levels, where it wavers now and manages to hold onto the positive territory.
The move is primarily sponsored by the rebound in US Treasury yields after Fed officials showed faith in the ongoing US economic recovery. Officials commented that one-month employment data could be considered as a temporary analysis for reopening the economy in sections, as some volatility is imminent. These comments had a positive impact on US Treasury yields with price trading at 1.60%, around 0,11% gains on the day at the time of writing.
US President Joe Biden delivered remarks on the economy on Monday and would meet with Republican and Democratic leaders on Wednesday for further economic discussion, including his $4 trillion legislative proposal.
As a cascading effect, the greenback bounced from the multi-day lows at 90.04 and made highs of 90.33.
On the other hand, the internal factors owing to the recent state of emergency pose a threat to the economic recovery in the coming few quarters, as predicted by Reuters polls. Household Spending in Japan increased 6.20% in March. The risk to Japan’s economy remain skewed to the downside as per the BOJ Summary of Opinions (April Monetary Policy) released on Tuesday.
Investors turn their attention toward the release of US JOLTs Job Openings data and Fed’s official speeches to gauge market sentiment.
USD/JPY Additional levels
Author
Rekha Chauhan
Independent Analyst
Rekha Chauhan has been working as a content writer and research analyst in the forex and equity market domain for over two years.
