- USD/JPY extended its sideways consolidative price action through the early NA session.
- Weaker sentiment around equity markets, sliding US bond yields seemed to cap the upside.
- The downside remains limited amid optimism that the pandemic may be reaching its peak.
The USD/JPY pair remained confined in a narrow trading band below the 109.00 round-figure mark and had a rather muted reaction to the US macro releases.
According to the data released this Thursday, the initial weekly jobless claims remained elevated at 6.61 million during the week ended April 3 and the previous week’s reading was revised higher to 6.87 million (6.65 million earlier).
This sums up to over 15 million jobless claims filed in the past three weeks and further illustrated the extent of economic fallout from the coronavirus pandemic, albeit did little to provide any meaningful impetus.
The fact that investors were anticipating another disastrous reading amid the coronavirus-led lockdown, the reaction turned out to be muted and failed to assist the pair to break out of its daily consolidative range.
Meanwhile, a weaker sentiment around equity markets benefitted the Japanese yen’s perceived safe-haven status. The anti-risk flow was further reinforced by a fresh leg down in the US Treasury bond yields.
Sliding US bond yields kept the US dollar bulls on the defensive, albeit the latest optimism over forecasts that the coronavirus pandemic peak could come soon helped limit the downside, at least for now.
Moving ahead, market participants now look forward to the Fed Chair Jerome Powell’s scheduled speech, which might influence the USD price dynamics and eventually provide some short-term trading impetus.
Technical levels to watch
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