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  • USD/JPY bulls denied in a sharp hourly drop in Asia.  
  • US dollar remains better bid as investors weigh the decoupling between EU and US.  

USD/JPY rose 45 pips to 109.20 overnight and holds around there following a dive in the last hour from the highs of 109.31.  

Meanwhile, stocks on Wall Street were higher following good news in the Gross Domestic Product revisions and jobless claims  numbers as well as  strengthening bond yields after a weak 7-year Treasury auction.

However, concerns about weaker demand amid renewed lockdowns are likely to continue to weigh on risk sentiment which can benefit both the yen and US dollar.  

The dollar index  hit its highest since November overnight, at 92.697, breaking its 200-day moving average. DXY rose 0.298% as the euro dropped.

Investors focussed on rising coronavirus cases in Europe and on signs that the US economy was rebounding from the pandemic faster than anticipated.

Investors also cheered the news from the White House that  US President Joe Biden has pledged 200 million COVID-19 vaccinations within the first 100 days in office.

As for data, the  third update on the fourth quarter  GDP saw it revised up marginally to 4.3%  from 4.1%.

US Initial jobless claims fell nearly 100,000 to 684,000, well below expected numbers.

That being said,  they remain high relative to normal. Continuing claims now stand at 3.8 million having fallen quite sharply in the latest weekly data.