- AUD/JPY remains trapped in a 100-pip range.
- Australian 10-year government bond yield hits a record low.
- Sliding Aussie yields and potential risk-off could trigger range breakdown.
AUD/JPY is lacking a clear directional bias amid the slide in the Australian government bond yields.
The pair has been largely restricted to a 100-pip range of 75.10-76.30 since July 2.
As of writing, the pair is sitting on the 50-day moving average (MA) support of 75.45, representing marginal losses on the day.
Australia’s 10-year government bond yield hit a record low of 1.231% in the overnight trade. Notably, the yield has shed more than 20 basis points over the last ten days.
Even so, AUD/JPY has been remained stuck in a sideways channel. A range breakdown could happen if equities turn risk-averse, putting a strong bid under the anti-risk Japanese Yen. As of writing, the futures on the S&P 500, a global benchmark for equities, are reporting 0.12% gains.
The case for downside break looks stronger if we take into account the upbeat Japanese data released earlier today, which showed core consumer prices in Tokyo rose 0.9% in July from a year earlier, beating the estimated rise of 0.8%.
Pivot points
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