Yen Rebounds, USD/JPY Bounces 50 Pips
The Japanese yen (JPY) strengthened again on Thursday in the Asian session, capitalizing on the broad weakness of the US dollar (USD). This sentiment pushed USD/JPY down from a nearly three-month low. The yen's main support came from speculation of Japanese government intervention to stem the currency's weakening, coupled with the Bank of Japan's (BoJ) continued hawkish stance.
Meanwhile, the US dollar remained stuck near the four-year low touched on Tuesday. Markets continued to speculate that the Fed could open room for further policy easing, so the pressure on the USD remained persistent. This combination of a stronger yen and a fragile dollar maintained pressure on the USD/JPY pair.
However, the yen's strengthening was not smooth sailing. Investors remained concerned about Japan's fiscal situation following Prime Minister Sanae Takaichi's large spending plans and tax cuts, coupled with political uncertainty ahead of the February 8th snap elections. The positive risk sentiment also limited the yen's appeal as a safe haven, causing USD/JPY to bounce around 50 pips from its daily low. Market focus now awaits the US Weekly Jobless Claims data, then shifts to Tokyo inflation data due out Friday. (az)
Source: Newsmaker.id
