AUD/JPY attracts some buyers above 102.00 as China’s trade balance grows more than expected

• AUD/JPY jumps to around 102.05 in the Asian session on Thursday, up 0.49% on the day.
• Risk-on sentiment and uncertainty over the BoJ rate hike weigh on the Japanese Yen.
• Encouraging Chinese economic data supports the Australian dollar, China’s proxy.

The AUD/JPY cross extends its rise to near 102.05 on Thursday during Asian trading hours. Risk appetite and uncertainty surrounding the Bank of Japan (BoJ) rate hike are putting some selling pressure on the Japanese Yen (JPY).

The victory of Republican Donald Trump in the US presidential elections drags the JPY downwards. Furthermore, minutes released by the BoJ on Wednesday showed that the Japanese central bank would not increase its policy interest rate under instability in financial and capital markets.

“In the current phase, the BoJ should patiently maintain the current accommodative financial conditions to support economic activity,” another Policy Council member said. Uncertainty over the BoJ rate hike is likely to undermine the JPY in the near term.

However, the fall of the JPY could be limited after the verbal intervention of the Japanese authorities. Japan’s top currency diplomat, Atsushi Mimura, said on Thursday that authorities were ready to act against “excessive” currency moves.

On the other hand, China’s trade balance grew more than expected in October, as exports increased, boosting the Australian Dollar (AUD), China’s proxy. The trade balance grew to $95.27 billion in October from $81.71 billion previously, exceeding expectations of $75.1 billion. Meanwhile, exports rose 12.7% year-on-year in October, compared with 2.4% in the previous reading. The figure was above the market consensus of 5.0%.