USD/JPY clings to small gains above 109 as focus shifts to Trump speech
- US Dollar Index extends consolidation above 98.
- US Pres. Trump is expected to deliver remarks on trade conflict with China.
- Wall Street looks to open the day modestly higher.
The USD/JPY pair is moving sideways above the 109 handle for the second straight day as investors stay on the sidelines while waiting for United States (US) President Donald Trump to deliver fresh remarks on the trade dispute with China. As of writing, the pair was up 0.15% on a daily basis at 109.20.
Focus shifts to US President Trump's speech
Ahead of President Trump's speech at a luncheon hosted by the Economic Club of New York, Politico reported that a source familiar with Trump's prepared remarks said that his statement on China will be constructive. If that turns out to be true, risk-on flows could re-take control of the market and make it difficult for the safe-haven JPY to find demand. In the meantime, major European equity indexes are posting modest gains on Tuesday and the S&P 500 Futures is up 0.1% to reflect a slightly upbeat market mood.
On the other hand, the US Dollar Index is moving sideways above the 98 mark in the absence of significant macroeconomic drivers, suggesting that the risk sentiment is likely to continue to impact the pair's movements.
Later in the session, Richmond Fed President Thomas Barkin and Philly Fed President Patrick Harker will be speaking as well. In the early trading hours of the Asian session, Producer Price Index (PPI) figures from Japan will be published but are likely to be ignored by investors.
Technical levels to watch for
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
