USD/JPY drops twoard 107.50 on fresh USD selloff
- USD/JPY came under modest bearish pressure during American session.
- Wall Street's main indexes gained traction after opening in positive territory.
- Retail Trade and Unemployment Rate data from Japan will be published on Friday.
The USD/JPY pair moved sideways around 107.80 for the majority of the day but lost its traction during the American session. As of writing, the pair was down 0.1% on the day at 107.58.
USD weakens modestly in American session
Although the US Dollar Index stayed relatively quiet following the macroeconomic data releases from the US, improving risk sentiment seems to be weighing on the greenback.
After starting the day with small gains, Wall Street's main indexes turned north in the last hour and were last seen rising around 0.4% on a daily basis. Meanwhile, the US Dollar Index, which stayed above 99.00 during the European session, is now down 0.35% at 98.60.
The data published by the US Census Bureau on Thursday revealed that Durable Goods Orders in April declined by 17.2% in April and came in better than the market expectation of -19%. On the other hand, the US Bureau of Economic Analysis in its second estimate said that the real Gross Domestic Product (GDP) in the US is expected to contract by 5% in the first quarter.
Finally, the weekly data showed that there were 2.1 million Initial Jobless Claims and 21 million Continuing Jobless Claims in the US. Commenting on the data, “The better-than projected continuing claims figure may serve as a tie-breaker in favor of higher stocks," said FXStreet analyst Yohay Elam. "In turn, that may weigh on the safe-haven US dollar and to some extent also push the yen lower. Commodity currencies and the euro may be the beneficiaries.”
In the early trading hours of the Asian session on Friday, Unemployment Rate, Industrial Production and Retail Trade data will be featured in the Japanese economic docket.
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.
