USD / JPY extends its sideways movement around 109.00

• USD / JPY is struggling to make a decisive move on Wednesday.
• The US dollar index remains on track to post its lowest daily close since March 18.
• The 10-year US Treasury yield has risen more than 1%.

After closing the first two trading days of the week in negative territory, the pair USD/JPY calmed down and continues to fluctuate in a relatively tight range on Wednesday. At time of writing, the pair was down 0.08% on the day at 108.96.

DXY falls for the third day in a row

Despite widespread selling pressure surrounding the dollar, USD / JPY losses remain limited on the day as the modest rally seen in U.S. Treasury yields makes it difficult for the JPY to find demand. Currently, the yield on the benchmark 10-year US Treasury is up 1.1% to 1,634%.

On the other hand, the US dollar index, which hit its lowest level in nearly four weeks at 91.57 earlier in the day, is consolidating its losses at 91.66 and remains on track to post its worst daily close since March 18.

The only US data on Wednesday showed that the Import Prive Index jumped to 6.9% annually in March from 3% in February, but this reading did not provoke a significant market reaction.

Meanwhile, FOMC Chairman Jerome Powell reiterated that it was “highly unlikely” that the Fed would start raising rates before the end of 2020, but added that the rate decision was “based on results.”

In the early hours of the Asian session on Thursday, Bank of Japan (BoJ) Governor Haruhiko Kuroda will deliver a speech. Later in the day, weekly data on initial jobless claims, retail sales and industrial production will be included in the US economic record.

Technical levels