- Risk aversion continues to dominate the market.
- 10-year US T-bond yield slumps to its lowest level since late March.
- Coming up: Weekly jobless claims, new home sales, and Markit PMI data from the U.S.
Despite the broad-based USD strength, the USD/JPY pair is posting losses for the second straight day on Thursday as the sour market sentiment continues to help the JPY outperform its rivals. As of writing, the pair was down 0.25% on a daily basis at 110.07.
With the U.S.-China trade tension remaining high and concerns over the possibility of a no-deal Brexit escalating, investors continued to move away from risk-sensitive assets on Thursday. Reflecting the flight-to-safety, major equity indexes in Asia closed the day in the negative territory and European stocks are now suffering heavy losses with Germany’s DAX and the UK’s FTSE both erasing around 1.5% on a daily basis.
Additionally, the 10-year US T-bond yield is losing nearly 2% on the day to confirm the dismal mood and allowing the bearish pressure on the pair stay intact.
On the other hand, with the greenback outperforming its major European rivals, the US Dollar Index is inching closer to its highest level since May 2017 that was set in late April at 98.33. At the moment, the DXY is up 0.1% on the day at 98.20.
Later in the day, weekly jobless claims, new home sales, and the IHS Markit’s Manufacturing and Service PMI reports from the U.S. will be looked upon for fresh impetus.
Technical levels to watch for