USDJPY gains bids to trim intraday losses, recovering from a one-month low.
The USDJPY reverses its previous one-month low in Asia, rising to 134.50 during the first hour of Tokyo trading on Monday. Yet, the Yen pair is down for the third day in a row. As Bank of Japan (BoJ) Governor Haruhiko Kuroda’s departure fuels hawkish calls for the Japanese central bank’s next steps. The cautious tone ahead of this week’s top-tier data/events, including the BoJ Minutes. And US consumer-centric statistics such as the Consumer Price Index (CPI) and Retail Sales for February. Might also be a challenge for pair buyers.
Yields and S&P 500 futures rebound as US authorities mitigate concerns posed by SVB and Signature Bank.
The current comeback in the Yen pair might be attributed to lately stronger US Treasury bond rates. As well as market risk-on mood, which is mostly driven by the US dollar. US authorities’ efforts to contain the financial market dangers posed by Silicon Valley Bank (SVB) and Signature Bank. Meanwhile, US 10-year Treasury bond rates have recovered from a four-month low near 3.75%. While the S&P 500 Futures have also recovered from a nine-week low.
Throughout the weekend, the US Treasury Department, Federal Reserve, and the Federal Deposit Insurance Corporation (FDIC) worked together. To mitigate the dangers posed by SVB and Signature Bank. “All depositors of Silicon Valley Bank and Signature Bank will be completely safeguarded.” The officials declared in a joint statement made a few minutes ago. “All Silicon Valley Bank and Signature Bank depositors will be completely safeguarded.”
The officials declared in a joint statement published a few minutes ago. back. After the late proposal for US authorities to contain the financial crisis. The S&P 500 Futures and US Treasury bond rates maintain the previous day’s losses.
The BoJ Minutes will be closely watched as hawkish bets on the Japanese central bank’s next action rise following Kuroda’s departure.
Notwithstanding the risk-on mentality, rising hawkish expectations on the Bank of Japan’s next move, particularly after Kuroda’s departure, appear to be exerting downward pressure on USDJPY pricing. The Federal Reserve’s (Fed) uncertainty following Friday’s mixed US jobs report might be along the same lines.
With a stronger-than-expected NFP print, consumer-centric statistics from the United States will be critical.
Nonetheless, US Nonfarm Payrolls (NFP) increased by more than 205K to 311K in February, expecting 504K (revised), while the Unemployment Rate increased to 3.6% for the same month, up from 3.4% projected and before. Moreover, average hourly earnings increased year on year but decreased month on month in February, while labor force participation decreased. Going forward, Wednesday’s BoJ Minutes will be critical in confirming the recent hawkish tilt for the Japanese central bank’s next step, which might impact on USDJPY prices if market projections are met.
Firmer prints of US consumer-centric data, on the other hand, might rekindle hawkish Fed bets ahead of the all-important March Federal Open Market Committee (FOMC) and jolt USDJPY bulls.
