USD/JPY remains on the uptrend above 114.00 amid the initial Tokyo trading hour on Monday. The yen pair rises for the second consecutive day. Monday’s headlines suggesting Prime Minister Fumio Kishida’s victory in snap elections, Firmer US Treasury yields and a mildly positive risk appetite underpin the bullish trend of yen pair.
New Japanese Prime Minister Fumio Kishida’s ruling Liberal Democratic Party had defied the expectations and held its strong majority in Sunday’s parliamentary election, solidifying his position in a fractious party and allowing him to ramp up stimulus.
Shinichiro Kadota, senior FX strategist at Barclays (LON:BARC) in Tokyo said that “The reduction in political uncertainty is playing out with slight yen weakness this morning.” “The bigger driver of dollar-yen direction going ahead remains the Fed.”
Traders have kept their focus on the Federal Reserve this week and the Nonfarm Payrolls report on Friday. The Fed is widely expected to announce its tapering start and plans this week.
”Financial markets are priced aggressively for hikes in 2022, but the Fed is unlikely to endorse or push back on those expectations at this point as we await more inflation evidence. Employment trends are expected to regain momentum, and we anticipate a 520k job gain for Nonfarm Payrolls,” analysts at Societe Generale explained.
US Core PCE Inflation data remained firmer around 3.6%, versus a 3.7% market forecast, for September and the US ISM Manufacturing PMI is expected at 60.4 versus 61.1. These data’s further escalates the bullish outlook for the greenback.
As far as monetary policy is concerned, The Reserve Bank of Australia also decides policy on Tuesday, with markets challenging the central bank’s contention that rates won’t rise until 2024 and The Bank of England announces its policy decision on Thursday, with markets weighing whether the monetary authority will raise rates at the meeting.
USD/JPY 4 Hour Chart:
Latest
Popular
Trending
Archives
Search
Top Tags