Japan coronavirus advisory panel is out with its recommendations on Thursday, as the third wave of the virus grips the economy and threatens to derail its post-pandemic recovery. The panel suggested that a state of emergency declaration is needed for Tokyo and three nearby prefectures from January 8 to February 7. 

Earlier today, it was reported that the Japanese PM Yoshihide Suga is likely to make a COVID-19 announcement at 0900 GMT. This comes after Japan’s daily corona virus infections totaled 6,004 cases, topping 6,000 for the first time since the start of the outbreak last year, a News tally reported.

Greenback made a recovery against yen after a long time. The recovery moves recently dwindled although risk catalysts recover on the safety of the US Capitol Hill building after a mob of President Donald Trump’s supporters attacked the premises before a few hours. Global traders currently await American policymakers’ move on the Electoral College vote as an immediate catalyst.

After a few hours of drama in Washington, coupled with one woman’s death, the protesters over President Trump’s defeat in the US 2020 elections seem to have been detained as officials convey safe passage in Capitol Hill. Even so, American Congress is angry with Mr. Trump and is ready to move forward in welcoming Democrats in the Senate after Jon Ossoff won in the Georgian Senate race.

Elsewhere, The US 10-year breakeven inflation rate rose to 2.06% on Wednesday, the highest level since November 2018, having bottomed near 0.5% in March 2020, according to data provided by the St. Louis Federal Reserve. Markets collapsed in March on fears of a corona virus-induced recession.  The 10-year US treasury yield has risen above 1% for the first time since March 2020.

USD/JPY 4 hour chart:

Support: 102.60 (S1), 102.17 (S2), 101.75 (S3).

Resistance: 103.45 (R1), 103.87 (R2), 104.30 (R3).

The fear of Covid-19 impacts yen negatively and we expect a bullish trend for USD/JPY.