The USDJPY pair remained within common levels for a third consecutive week, ending the latest in the short are just below the 109.00 resistance. The currency pair rose moderately on Friday among rising dollar’s demand, but gains were cautious considering the poor performance of stocks and poor government bond yields. The US Treasury yields were little improved by the end of the week, with that on the 10-year note settling at 1.52%.
On the economic data, Japanese annual inflation printed at -0.4% Yo in April as expected. The core reading, which excludes fresh food prices, came in at -0.1%, slightly better than anticipated. The preliminary estimate of the May Jibun Bank Manufacturing PMI printed at 52.5, below the 53.8 expected and the previous 53.6. Bank of Japan Governor Haruhiko Kuroda will provide the opening comments at an online conference this Monday.
Technically the pair is between a neutral to bearish near-term momentum and we recommend to sell on a possible bull move. We expect the USDJPY pair to continue the bearish trend as the US Dollar continues to weaken.
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