English
USD/JPY Maintains Modest Gains Below 150.00 In The Wake Of Japanese PMI Data
USD/JPY posts modest gains near 149.76 following the release of Japanese PMI data. The October manufacturing PMI from the Japanese Jibun Bank decreased to 48.5 from 48.5 previously, which was below expectations. The Chicago Fed National Activity Index indicates that a recession is still a considerable distance off. Investors anticipate new impetus from the S&P Global PMI reports.
The USD/JPY pair maintains modest gains on Tuesday morning, rebounding from a low of 149.55 during the Asian trading session. Presently, the pair is trading near 149.76, an increase of 0.03% on the day. The apprehension of FX intervention by the Japanese government, nevertheless, persists.
According to the most recent economic data released on Tuesday, the manufacturing PMI for October at the Japanese Jibun Bank declined to 48.5 from 48.5 previously, which was below market expectations of 48.9. The Services PMI, meanwhile, increased from its previous reading of 53.8 to 51.1.
Governor Kazuo Ueda of the Bank of Japan (BoJ) reaffirmed last week that the BoJ would "patiently maintain current easy policy." This causes the Japanese Yen (JPY) to experience some selling pressure against the US Dollar (USD). Despite this, traders will closely observe any potential FX intervention by the Japanese government in an effort to bolster the JPY's depreciation.
Alternatively, a weaker Greenback could limit the pair's upside. At 105.57, the US Dollar Index (DXY), which measures the USD's value in relation to a basket of foreign currencies, falls to its lowest level in a month. The 10-year Treasury yield experienced significant volatility this week, peaking at 5.02% for the first time since 2007. However, it subsequently reversed course and declined to 4.865%.
The Chicago Fed National Activity Index indicates that a recession is still a considerable distance off. From -0.22 in August to +0.02 in September, the value increased. An index value of zero signifies that economic growth is conforming to the trend. An index value of zero indicates that the present rate of economic expansion is sustained.
Tuesday, traders will closely monitor the US S&P Global PMI data. Preliminary figures for the US Gross Domestic Product (GDP) and the Core Personal Consumption Expenditure Index for the third quarter will be released on Thursday and Friday of this week, respectively. The absence of speeches by Fed officials this week is a consequence of the embargo period preceding the FOMC meeting the following week.
Wednesday will see the release of the Japanese Coincident Index and Leading Economic Index for August, both of which will affect the JPY. The focus will transition to the annual Tokyo Consumer Price Index (CPI) for October on Friday. These figures may provide the USD/JPY pair with a distinct direction.
Bonus rebate to help investors grow in the trading world!
