The US Dollar closed on Thursday almost flat judging by the DXY Index. The US Dollar price action was mixed across the board of major currency pairs with trends against the Yen largely make up for weakness versus the British pound. Treasury yields rose for the second day in a row with the ten-year extending its rebound off Wednesday’s swing low to 5.4-basis points. Bond yields stayed perky even after strong demand was seen for today’s $62-billion seven-year Treasury auction.
All the above likely helped push USDJPY to a new monthly high, though the bid questionably looked worsened by a broadly softer Yen. Maybe news that the MSCI Global Standard Index is removing 29 Japanese listings weighed negatively on the Yen and positively on JPY-crosses. That said, the latest increase by the USDJPY pair seems to have canceled its bearish trendline as bulls wrestle back control.
In the Friday’s economic data schedule, we can see that high-impact risk is caused by the scheduled release of monthly PCE inflation data. This is the Fed’s favorite gauge of inflation and stands to have impact on markets.
We remain bullish on the USDJPY for today.
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