- USD/JPY registers modest daily gains above 107.00 on Monday.
- JPY struggles to find demand amid upbeat market mood.
- US Dollar Index is staying in the red near 96.50.
The USD/JPY pair spent the Asian session moving sideways below 107.00 before gaining traction during the European trading hours. As of writing, the pair was up 0.3% on a daily basis at 107.20.
Risk sentiment on Monday remains as the primary driver of USD/JPY’s movements. Heightened hopes surrounding an effective coronavirus vaccine helped global equity indexes start the new week on a firm footing. At the moment, major European stock indices are up between 1% and 1.2%.
Additionally, the S&P 500 futures are up 0.7% on the day, suggesting that the upbeat market mood, which weighs on safe-haven JPY, is likely to remain intact in the second half of the day.
DXY edges lower on Monday
On the other hand, the greenback is also struggling to find demand with the US Dollar Index (DXY) posting modest daily gains around 96.50 and keeping the pair’s upside limited. There won’t be any significant macroeconomic data releases from the US in the remainder of the day.
On Tuesday, Industrial Production and Capacity Utilization data will be featured in the Japanese economic docket. Earlier in the day, the Bank of Japan (BoJ) announced that it has appointed Seiichi Shimizu, head of its markets department, to lead a new monetary policy team to tackle the negative impact of the coronavirus.
Technical levels to watch for
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