- USD/JPY met with some fresh supply on Friday and retreated further from over one-week tops.
- Worries over rising coronavirus cases benefitted the safe-haven JPY and exerted some pressure.
- The USD extended its consolidative price action and moved little after mixed US macro releases.
The USD/JPY pair retreated further below the 107.00 round-figure mark and dropped to fresh session lows in the last hour.
The pair came under some fresh selling pressure on the last trading day of the week and extended the previous day's pullback from over one-week tops, around the 107.45 region. The downtick could be solely attributed to reviving safe-haven demand for the Japanese yen.
Investors remain concerned about the second wave of coronavirus infection and the possibility of renewed lockdown measures to control the spread. This, in turn, dampened prospects of a sharp V-shaped global economic recovery and continued taking its toll on the risk sentiment.
On the other hand, the US dollar struggled to capitalize on its gains recorded over the past two trading sessions and remained confined in a narrow trading band. A subdued USD price action did little to influence the intraday momentum or lend any support to the USD/JPY pair.
The greenback remained on the defensive against its Japanese counterpart following the release of mixed US macro data. A report by the US Bureau of Economic Analysis (BEA) showed that Personal Spending in the US increased by 8.2% in May as compared to 9% growth anticipated.
Conversely, Personal Income fell less than expected, by 4.2% during the reported month vs. -6% anticipated. Adding to this, Core PCE Price Index – the Fed's preferred inflation gauge – came in at 0.1% MoM for May as against estimates pointing to a flat reading.
Friday's US economic docket also features the release of the revised Michigan Consumer Sentiment Index for June, which might also fail to provide any meaningful impetus to the USD/JPY pair. Hence, the broader market risk sentiment will be looked upon for some short-term trading impetus.
Technical levels to watch
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 trades weak below 1.0800 amid Good Friday lull, ahead of US PCE
EUR/USD remains depressed below 1.0800 after soft French inflation data, amid minimal volatility and thin liquidity on Good Friday. The pair keenly awaits the US PCE inflation data and Fed Chair Powell's speech for fresh hints on next week's price action.
GBP/USD holds steady above 1.2600 as markets stay calm on Good Friday
GBP/USD trades sideways above 1.2600 amid a typical Good Friday trading lull. A broadly firmer US Dollar could keep any upside attempts limited in the pair ahead of the US PCE inflation data and Fed Chair Powell's appearance.
Gold price sits at all-time highs above $2,230, US PCE eyed
Gold price hit all-time highs at $2,236 on Thursday to finish Q1 2024 with a bang. Most major world markets, including the US are closed due to Holy Friday, leaving volatility around Gold price highly subdued. US PCE inflation and Powell are awaited.
Jito price could hit $6 as JTO coils up inside this bullish pattern
Jito (JTO) price has been on an uptrend since forming a local bottom in early January. Since then, JTO has revisited the key swing point formed in early December, suggesting the bulls’ intention to move higher.
Key events in developed markets next week
Next week, the main focus will be inflation and the labour market in the Eurozone. We expect services inflation to be impacted by the easter effect, while the unemployment rate to be unchanged.