- USD/JPY remains depressed near March 12 low after dropping the most in 10 weeks.
- US President Donald Trump claims victory despite lagging behind Biden’s 260+ votes.
- Stimulus hopes propel risks, drag DXY to one-month bottom.
- Japan’s Overall House Hold Spending recovered, US NFP, election updates in the spotlight.
USD/JPY stays pressured near 103.50 amid the initial hour of Friday’s Tokyo open. The yen pair refreshed multi-day bottom on Thursday, while also declining the most since late-August, as the US dollar got heavily offered on election updates as well as dovish Fed.
Although US President Donald Trump recently said that I will easily win, his narrow gains in Georgia, coupled with the overall weaker electoral vote count, defy the Republican optimism. On the other hand, Democratic candidate Joe Biden holds over 260 votes versus the 270 required while taking the lead in Pennsylvania and Arizona.
Check live updates for the 2020 US elections here.
Given the Democratic Party’s stimulus-friendly nature, global markets cheer increasing odds of Biden’s victory despite looming fears of a delay in the final decision until January and a GOP Senate.
Not only the trading optimism but Fed Chair Jerome Powell’s cautious words marking the tail risk also weighed on the US currency. That said, the US dollar index (DXY) currently wavers around the October low of 92.47.
It’s worth mentioning that the record daily high in the new coronavirus (COVID-19) cases from the US, 109,000 on Thursday, added weakness to the USD.
On the data front, Japan’s Overall Household Spending for September recovered from -10.7% forecast to -10.2% YoY.
As a result, Japan’s Nikkei 225 and Australia’s ASX 200 print mild gains but S&P 500 Futures drop 0.40% intraday by press time.
Global markets will be closely watching the US election updates for fresh impetus while also waiting for the American employment numbers for October.
Read: Nonfarm Payrolls Preview: Encouraging data but little action expected
Technical analysis
With a clear downside break of a support line, now resistance, from July 31, USD/JPY bears are looking towards the sub-103.00 area unless bouncing back beyond 103.85.
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