USD/JPY: sentiment remains dominant - Scotiabank

Ross J Burland FXStreet

With respect to USD/JPY, analysts at Scotiabank explained that sentiment remains dominant in the aftermath of this week’s Trump/Kim meeting and risk reversals suggest a continued erosion in the premium for protection against JPY strength vs. both the USD and EUR.

Key Quotes:

"Yield spreads are also widening in a JPY-negative manner and the 2Y U.S.-Japan spread has almost fully retraced its decline from mid-May."

"Domestic risk is limited ahead of Friday’s industrial production data and BoJ policy decision."

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

EUR/USD turns negative near 1.1850

EUR/USD has given up its earlier intraday gains on Thursday and is now struggling to hold above the 1.1850 area. The US Dollar is finding renewed support from a pick-up in risk aversion, while fresh market chatter suggesting Russia could be considering a return to the US Dollar system is also lending the Greenback an extra boost.

GBP/USD change course, nears 1.3600

GBP/USD gives away its daily gains and recedes toward the low-1.3600s on Thursday. Indeed, Cable now struggles to regain some upside traction on the back of the sudden bout of buying interest in the Greenback. In the meantime, investors continue to assess a string of underwhelming UK data releases released earlier in the day.