USDJPY struggles at 147.00 after bouncing off one-month low 146.55
- The dollar dives 0.9% on the day and hits one-month lows at 146.55.
- US payrolls increase, but unemployment rises, and salaries slow down.
- USDJPY: More likely to peak at 155 than at 160 – MUFG.
The US dollar is trying to return above 147.00 in the US afternoon trading session, to trim losses after having lost nearly 0.9% on the day, reaching one-month lows at 146.55.
The US dollar dives on the back of the US Non-Farm Payrolls report
The greenback accelerated its downtrend on Friday, after the release of a mixed US NFP report. Employment creation remains robust, with non-farm private payrolls increasing by 261K in October, beating expectations of 200K and September’s figures revised up to 315K, from the previously estimated 4 K.
On the other hand, the unemployment rate has risen to 3.7% from 3.5% in September, above the consensus of 3.6%, while hourly earnings increased by 4,7% in October from 5% in September. These figures suggest that labor market conditions might be starting to ease and have revived the possibility of a shorter rate hike in December.
USDJPY: Ceiling at 155, with 160 a long way off – MUFG
From a wider perspective, Analysts at MUFG anticipate that the USDJPY peak might not be far off: “We forecast a near-term USDJPY ceiling of 155 given that it has already passed 150 once, is still hovering around 148, and considering the speed of its ascent over the last six-plus months (…) The 2 April 1990 high of 160.35 could come into view if the Fed steps up its communication with the market and a terminal rate of 5.5% to 6% comes into view, but we do not expect this at present.”
Technical levels to watch
Author
Guillermo Alcala
FXStreet
Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.
