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JPY: Tests Above 158.50 Amid Continued Dollar Gains, Labour Earnings Today

JPY
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USD/JPY spent most of Wednesday's post Asia close on the front foot, reaching fresh highs of 158.55. We sit slightly lower in early Thursday dealings, last near 158.40, the pair up around 0.20% for Wednesday's session. Broader USD sentiment remained positive, although yen outperformed some other majors, most notably GBP (which lost 0.90%). The BBDXY index and DXY indices are both around 0.40% higher.

  • Little has changed from a USD/JPY technical standpoint. Upside focus rests on 159.45, the July 12 high from last year. Moving average studies are in a bull-mode position highlighting a dominant uptrend. Initial firm support is 156.24, the 20-day EMA.
  • Overnight news was mixed from a cross asset standpoint. CNN reported incoming President Trump is considering a national economic emergency declaration to allow for a new tariff program, which was a USD positive.
  • US data was mixed, with ADP weaker, but initial jobless claims down more than forecast. The FOMC minutes argued for caution around rate cuts, but Fed Governor Waller continued to argue forcefully for rate cuts. US Tsys yields sit a touch softer at the front end.
  • Locally today, we have Nov labour cash earnings. Nominal pay is expected to rise 2.7% y/y (prior 2.2%). Real earnings are projected to be negative at -0.6% y/y though. We also have weekly investment flows.
  • A former BoJ board member stated that the next hike was likely to be in March, given uncertainties around the incoming US administration (see this BBG link). 
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USD/JPY spent most of Wednesday's post Asia close on the front foot, reaching fresh highs of 158.55. We sit slightly lower in early Thursday dealings, last near 158.40, the pair up around 0.20% for Wednesday's session. Broader USD sentiment remained positive, although yen outperformed some other majors, most notably GBP (which lost 0.90%). The BBDXY index and DXY indices are both around 0.40% higher.

  • Little has changed from a USD/JPY technical standpoint. Upside focus rests on 159.45, the July 12 high from last year. Moving average studies are in a bull-mode position highlighting a dominant uptrend. Initial firm support is 156.24, the 20-day EMA.
  • Overnight news was mixed from a cross asset standpoint. CNN reported incoming President Trump is considering a national economic emergency declaration to allow for a new tariff program, which was a USD positive.
  • US data was mixed, with ADP weaker, but initial jobless claims down more than forecast. The FOMC minutes argued for caution around rate cuts, but Fed Governor Waller continued to argue forcefully for rate cuts. US Tsys yields sit a touch softer at the front end.
  • Locally today, we have Nov labour cash earnings. Nominal pay is expected to rise 2.7% y/y (prior 2.2%). Real earnings are projected to be negative at -0.6% y/y though. We also have weekly investment flows.
  • A former BoJ board member stated that the next hike was likely to be in March, given uncertainties around the incoming US administration (see this BBG link).