- Yen is pushing higher with the S&P 500 futures flashing red.
- Risk-off is being associated with fears of a Corona virus outbreak.
- Markets may be selling risk ahead of President Trump's impeachment proceedings.
- BOJ is likely to keep key policy tools unchanged.
The bid tone around the anti-risk Japanese yen strengthened a few minutes before press time, pushing USD/JPY lower from 110.21 to a session low of 109.91, possibly tracking the losses in the US equity index futures.
Risk-off
The futures on the S&P 500 are currently reporting a 0.30% drop on the day. The index futures and the Asian stocks have come under pressure reportedly due to the outbreak of the corona virus.
Also, political uncertainty could be weighing over the equities. The US Senate is set to begin the impeachment trial against President Donald Trump on Tuesday to decide on whether to convict and remove him from office on two charges: abuse of power and obstruction of Congress.
The House passed the abuse of power article of impeachment in mid-December and also charged Trump with obstruction of Congress.
With Republicans in control of the Senate, Trump's impeachment looks unlikely. Nevertheless, markets seem to be selling risk and buying haven assets at press time.
Global growth slowdown
The International Monetary Fund (IMF) on Monday said the global economy will expand by 3.3% in 2020 and 3.4% next year, marking reductions from the previous forecasts, mainly because of lower growth in India.
The fund's downward revision of growth forecasts indicates the projected recovery for global growth remains uncertain. That could be pushing the yen higher.
BOJ to stand pat
The Bank of Japan (BOJ) is likely to keep key policy tools unchanged on Tuesday. The Bank will also be releasing its quarterly Outlook Report together with its decision.
The rate decision will likely be a non-event for the markets, unless the central bank offers a dovish or hawkish surprise, although that looks unlikely.
Technical levels
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
AUD/USD pressures as Fed officials hold firm on rate policy
The Australian Dollar is on the defensive against the US Dollar, as Friday’s Asian session commences. On Thursday, the antipodean clocked losses of 0.21% against its counterpart, driven by Fed officials emphasizing they’re in no rush to ease policy. The AUD/USD trades around 0.6419.
EUR/USD extends its downside below 1.0650 on hawkish Fed remarks
The EUR/USD extends its downside around 1.0640 after retreating from weekly peaks of 1.0690 on Friday during the early Asian session. The hawkish comments from Federal Reserve officials provide some support to the US Dollar.
Gold price edges higher on risk-off mood hawkish Fed signals
Gold prices advanced late in the North American session on Thursday, underpinned by heightened geopolitical risks involving Iran and Israel. Federal Reserve officials delivered hawkish messages, triggering a jump in US Treasury yields, which boosted the Greenback.
Bitcoin Price Outlook: All eyes on BTC as CNN calls halving the ‘World Cup for Bitcoin’
Bitcoin price remains the focus of traders and investors ahead of the halving, which is an important event expected to kick off the next bull market. Amid conflicting forecasts from analysts, an international media site has lauded the halving and what it means for the industry.
Is the Biden administration trying to destroy the Dollar?
Confidence in Western financial markets has already been shaken enough by the 20% devaluation of the dollar over the last few years. But now the European Commission wants to hand Ukraine $300 billion seized from Russia.