USD/JPY: Off intraday top, still above 107.00, as trade sentiment dwindles

Monday, 25 May 2020 11:17 WIB



USD/JPY retreats from the intraday high near 107.80 to 107.65 amid the early trading session on Monday. Although news of Japan’s likely removes of state of emergency from Tokyo and nearness to another aid package seems to probe the risk-off sentiment, the US-China row over Hong Kong issue keeps the traders’ worries amid quiet markets.

Ever since the Chinese diplomats showed readiness to Hong Kong’s autonomy at the 13th National People’s Congress (NPC), global policymakers ran the anti-China show, led by the US diplomats. However, US President Donald Trump’s absence from the league seems to ire the risk-averse traders off-late.

On the contrary, Japanese government readiness to another aid package, worth nearly $1 trillion, coupled with likely scrapping of the coronavirus (COVID-19) led restrictions from Tokyo, favor the risk reset wave.

Even so, China’s Global Times continues to use harsh words while terming the recent US decisions as more political. It’s worth mentioning that the US policymakers are inching towards a bill that would restrict Chinese companies’ listing on the American exchanges. Additionally, the Trump administration is also waiting for House approval to sanction Chinese diplomats in the Xinjiang case.

Amid all these catalysts, Japan’s NIKKEI slips from the intraday high of 20,720 to 20,580, still up 1.0%, by the press time.

Moving on, Japan’s Leading Economic Index and Coincident Index, 83.8 and 90.5 respective priors, could offer immediate directions to the pair. One shouldn’t forget that the US-China updates and virus news will keep the driver’s seat.

Source: FxStreet


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