- The Aussie stoops lower against the Yen as Japanese Retail Sales print in the red, hiking demand for the safe haven JPY.
- AUD’s empty calendar for the week places extra emphasis on overall market sentiment, which has boded poorly for the Aussie thus far.
The AUD/JPY is trading near 80.80 in Thursday’s Asia session, testing into 2018’s lows as the Aussie continues to flub against the safe haven Yen.
The JPY has bumped higher in markets following a Retail Sales reading for the Japanese economy that missed expectations, counter-intuitively sending the JPY higher as traders backed up into the safe haven.
Year-on-year Retail Sales figures for May clocked in at 0.6%, coming in below the expected 0.9% and far below the previous reading of 1.5%, while Large Retailers’ Sales contracted by -2.0%, much worse than the forecast -1.1% and a steepened downturn from the previous reading of -0.8%. The Japanese economy has struggled to develop steady growth despite years of hyper-easy monetary policy from the Bank of Japan (BoJ), and the longer the inflation-averse economy continues to juggle middling economic data, the longer the BoJ is expect to remain frozen in its tracks on policy measures.
The Aussie is devoid of meaningful data on the economic calendar this week, and overall market sentiment is expected to remain firmly in the driver’s seat for the AUD.
AUD/JPY levels to watch
The AUD/JPY is inching towards June’s low of 80.6, and a break of the level will see the pair challenging 2018’s current low marked out at March’s low of 80.50, and a bearish continuation will see the Aussie etch in a new low for the year, while a bullish reversal sees plenty of resistance at last week’s high of 81.90, with June’s high of 84.50 resting far above.
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