USDJPY has plummeted dramatically to about 140.00 as the USD index has fallen.
In the Asian session, the USDJPY pair has fallen vertically to approximately 140.00. The asset’s downward movement is supported by a massive sell-off in the US Dollar Index (DXY).
Investors have reduced their long positions in the USDJPY pair. As a rise in the US debt ceiling has reduced the attraction of the USD index. And serious conversations about adjusting the Bank of Japan’s (BoJ) Yield Curve Control (YCC) are strengthening the Japanese Yen.
The risk profile would be conservative since investors believe the Fed will raise interest rates again due of consumer spending resilience.
S&P500 futures have pared some of their initial gains. As investors brace themselves for a wild day in New York. USDJPY Investors are anticipated to close off long-weekend holdings. Which might result in significant swings. The risk profile would be conservative since investors believe the Federal Reserve (Fed) would raise interest rates again due of consumer spending resilience.
US Treasury rates have fallen dramatically as investors believe. That a two-year extension of the US debt ceiling would be approved by Congress. US 10-year Treasury rates have fallen below 3.76%.
This week’s US employment numbers will be closely scrutinized. Initially, Tuesday’s JOLTS Job Openings data will be provided on Wednesday, with a decrease to 9.35M compared to the previous release of 9.59M.
The US Automatic Data Processing (ADP) Employment Change (May) report will be issued later on Thursday. According to estimates, the US labor market has gained 170K new payrolls, compared to the previous addition of 296K. The Nonfarm Payrolls (NFP) will be the show-stopper event on late Friday.
The Bank of Japan will continue to acquire bonds in order to keep inflation over 2%.
On the Japanese Yen, BoJ Governor Kazuo Ueda stated on Tuesday. “The BoJ will patiently maintain the easy monetary policy as there is still a distance to go to achieve stable 2% inflation.” He also stated that inflation is anticipated to rise after the middle of 2023. Owing to wage increases and other reasons. But that prognosis remains unknown. Meanwhile, the Bank of Japan will continue to acquire bonds.
