- Limited gains in equity markets and lower US yields are driving the Japanese yen across the board.
- US dollar retreats in US hours, DXY turns negative.
- USD / JPY clears the gains, back to the previous range around 114.00.
USD / JPY fell further during the US session on Friday and fell to 113.75, hitting a two-day low. Earlier in the day, the pair rose to 114.29, reaching the highest level in nearly two weeks.
The combination of lower US yields, caution in equity markets and mixed US economic data strengthened the Japanese yen on Friday. The US dollar lost momentum near the end of the week. The DXY is falling after a strong two-day rally. It reached a new multi-month high at 95.26 and then fell back towards 95.10.
Economic data released on Friday showed that the consumer confidence index, as measured by the University of Michigan, fell from 71.7 to 66.8, below expectations of an increase to 72.4. US yields bottomed out after the report as 10-year bonds fell to 1.54%.
The outlook for USD / JPY continues to point to a consolidation after the strong rebound from 112.70 back above 113.40. It goes back to the previous range around 114.00. A daily close above 114.40 should point to more gains, while below 113.30, a test of the monthly lows seems likely.
Technical levels
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