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  • USD/JPY is looking to close fourth straight day in the negative territory.
  • Risk-averse market environment helps JPY preserve its strength.
  • US Dollar Index retreats below 93.00 in late American session.

The USD/JPY pair slumped to its lowest level since late July at 104.53 on Thursday and seems to be having a difficult time staging a meaningful rebound. As of writing, the pair was down 0.2% on a daily basis at 104.73.

JPY capitalizes on safe-haven flows

The risk-averse market atmosphere, as reflected by sharp declines witnessed in global equity indexes, helped the JPY find demand and stay strong against its rivals. At the moment, the S&P 500 Index is and the 10-year US Treasury bond yield both lose more than 1% on the day.

Meanwhile, following the FOMC-inspired upsurge seen during the Asian session, the US Dollar Index (DXY) lost its traction in the second half of the day and dropped into the negative territory below 93.0, allowing the bearish pressure on USD/JPY to remain intact. 

Earlier in the day, Bank of Japan (BoJ) left its policy rate unchanged as expected and Governor Haruhiko Kuroda reiterated that they won’t hesitate to ease the policy further if needed. Kuroda further noted that it was possible for rates to go lower but the JPY paid little to no attention to these remarks.

On Friday, the National Consumer Price Index (CPI) data from Japan will be looked upon for fresh impetus. The University of Michigan’s Consumer Sentiment Index will be the only data featured in the US economic docket.

Technical levels to watch for