USD/JPY pushes above 110.00 ahead of US inflation data
- USD/JPY edges higher on Tuesday in the initial part of the Asian session.
- US Dollar Index remains steady above 92.60 despite lower US Treasury yields.
- The Japanese Yen manages to gain on its safe-haven appeal.
The USD/JPY pair prints minute gains on Tuesday in the early Asian trading hours. The pair tested the high of 110.16 in the US session but retraced back to 109.90 after the release of the US consumer’s inflation expectations, which jumped to 5.2% in August. At the time of writing, USD/JPY is trading at 110.02, up 0.02% for the day.
The US Dollar Index (DXY), which measures the performance of the greenback against its six major rivals trades above 92.60, diverging its path from the bond yields. This, in turn, keeps USD/JPY higher.
The greenback gained traction amid reduced risk appetite as a resurgence in COVID-19 cases in vaccinated countries, such as Britain and Singapore and on the heightened expectations that the Fed would start to reduce bond purchases as soon as November.
On the other hand, the Japanese yen holds ground benefiting from its safe-haven appeal. The optimism in the political front after Taro Kono formally announced his candidature to lead the ruling Liberal Democratic Party (LDP) in the upcoming elections.
Meanwhile, an earthquake of 6.1 magnitudes was felt in Japan with no tsunami warning.
It is worth noting that, S&P 500 Futures were trading at 4,468, up 0.23% for the day.
As for now, investors are waiting for the US Consumer Price Index and Japanese Industrial Production data to gauge the 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.
