AUD/JPY rises towards 71.00 as Aussie GDP flashes upbeat marks

• AUD/JPY fails to hold onto the previous weakness.
• Global central banks, institutions undertake efforts to tame the negative economic implications of coronavirus.
• COVID-19 headlines, surprise moves by global central banks will be the key.

AUD/JPY rises to an intra-day high near 70.92 following the upbeat Aussie Q4 GDP amid Wednesday’s Asian session. The pair earlier witnessed downside amid fears of the coronavirus impacts on the global economy.

Australia’s fourth quarter (Q4) 2019 GDP beat estimates of 0.3% QoQ and 1.9% YoY while flashing 0.5% and 2.2% growth numbers respectively. It should also be noted that Japan’s Jibun Bank Services PMI for January crossed 46.7 forecasts to 47.00.

With that, the fears of stimulus measures from the Australian government, as signaled by the Aussie PM Morrison during Tuesday, seem to have receded.

However, the macro risk-off continues as the Hong Kong Monetary Authority (HKMA) extends the RBA and the Fed-led rate cut trajectory to Asia. Also showing the global efforts to counter coronavirus impact is the World Bank Group’s immediate relief fund as well as signals that China may undertake open market operations.

While portraying the global risk-off, the US 10-year treasury yields drop to a fresh record low near 0.98% whereas the S&P 500 Futures also slip near 0.70% to 3,018. Further, Japan’s NIKKEI rises 0.40% to 21,175 by the press time.

Investors will now focus on the COVID-19 headlines as well as any surprise moves by the global central banks, institutions for the near-term direction.

Technical Analysis

With the multi-year falling trend line from June 2012 limiting the AUD/JPY pair’s immediate upside around 70.93, the quote is likely declining to a 15-month-old support line near 69.15.