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Biden Commits To Taiwan Defence, Beijing Pushes Back

DATA REACT

EURUSD to high of the day but limited FI reaction

DATA REACT

EURUSD to high of the day but limited FI reaction

GERMAN DATA

PMI: "Unprecedented" rise in output prices

JPY

USD/JPY continued to unwind its recent rally yesterday, extending its move away from the 200-DMA, an important near-term resistance. The rate registered some gains in Asia-Pac hours, but dived into the WMR fix amid broader greenback sales.

  • Japanese earnings accelerated their decline in Dec, but fell at a slower pace than forecast. Still, the drop in wages was the steepest since Jun 2015.
  • FinMin Aso informed that the cabinet has approved Y1.1tn of reserve fund use, which will be used for Covid-19 response measures.
  • A Jiji report suggested that the gov't is considering lifting the state of emergency in Aichi, Gifu & Fukuoka prefectures.
  • USD/JPY trades -5 pips at Y105.18 at typing. A break under Feb 4 low of Y104.98 would open up Jan 11 high of Y104.40, a recent breakout level. Bulls keep an eye on the aforementioned 200-DMA at Y105.56 & Feb 5 high of Y105.77, followed by the 1.50 projection of the Jan 6 - 11 swing at Y106.05.
  • Looking ahead, Japanese machine tool orders (p) are due later today.

MNI London Bureau | +44 203-865-3806 | krzysztof.kruk@marketnews.com
MNI London Bureau | +44 203-865-3806 | krzysztof.kruk@marketnews.com