- DXY spiking in Tokyo as trade wars rear their ugly head again.
- Start of the month gets off to a grim start data-wise from around the globe.
USD/JPY is currently trading at 107.28, +0.14%, having travelled from a low of 107.02 to a high of 107.28 on Friday for the first day of the month. The dollar was losing steam and the yen was benefitting as markets moved out of the way of that train. The equity mood was souring from the get-go for the end of the month, whereby the dollar picked up the flack initially, but then tailed off again.
First of all, trade war headlines are resurfacing following a number of remarks from the US President Donald Trump of late. Yesterday's headlines, US Pres Trump: US trade deal with China has been “upset very badly” by the coronavirus, kicked up a storm in the US dollar although the rally petered out after USD/JPY got into the 106.80, tailing back to the 106.40s. However, the pair has since moved higher and exceeded yesterday's highs and the bulls are back in the game. The latest comments from Trump is right to the point and he says that he could use tariffs to respond to China.
Global data looking grim
Meanwhile, it was a dark day for European sentiment following a disappointing European Central Bank meeting, with Main rates unchanged at -0.0%, 0.25%, -0.5% while the ECB does not add to bond-buying limits. The Eurozone Gross Domestic Product and jobs reports were also grim. Over in the States, the US jobless claims remained very high. US stocks sagged into the close and despite the flattening of the COVID-19 curve. Indeed, the number of new cases slowing has had a calming effect in markets with stocks making a comeback (S&P 500 meets a 61.8% Fibo of stock market rout), but the months ahead will probably still be quite volatile which maks both the yen and the dollar attractive currencies to own.
USD/JPY levels
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