- USD/JPY hovers around Wednesday’s close of 128.85, aiming to close below to extend its downtrend.
- Unemployment claims in the US came lower than expected, as traders expect further tightening.
- Japanese inflation data is expected to edge higher; what would the BoJ do?
The USD/JPY reverses its course and edges lower late in the North American session, down by 0.33% on Thursday. Risk aversion weighed on the US Dollar (USD), which extended its losses but was capped by the rise in US Treasury bond yields. At the time of writing, the USD/JPY is trading at 128.33 after hitting a daily high of 128.88.
USD/JPY in choppy trading before Japanese CPI release
Wall Street continues to show a dampened mood. Thursday’s economic data in the United States (US) pointed to a tight labor market, as Initial Jobless Claims for the last week edged lower, by 190K less than the 214K consensus. Further data reported that the US housing market continues to deteriorate. Housing Starts and Building Permits missed estimates, while the Philadelphia Fed Manufacturing Index, although in contractionary territory at -8.9, improved compared to November’s -13.7 reading.
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