USD / JPY turns negative on the day below 109.70 amid the USD sell-off

  • The US Dollar Index fell below 93.00 during US business hours.
  • Risk appetite is limiting the decline in USD / JPY.

After climbing to a daily high of 110.15, the USD / JPY pair lost its traction during US trading hours and turned negative for the day. At time of writing, the pair was down 0.1% on the day at 109.69.

USD selloff gains momentum

Earlier in the day, the JPY struggled to meet demand as a safe haven with risk flows dominating the financial markets. However, the selling pressure surrounding the dollar made it difficult for the pair to retain its bullish momentum in the second half of the day.

Reflecting the general weakness of the USD, the US Dollar Index is down 0.53% to 92.96. Meanwhile, the S&P 500 Index is trading at a new all-time high of 4,486, rising more than 1% on the day. However, market optimism keeps JPY gains limited for now.

Data released by IHS Markit revealed on Monday that growth momentum in both the manufacturing and services sectors eased in August with the manufacturing PMI and services PMI retreating from July levels. Other data from the US showed that existing home sales increased by 2%, beating the market expectation of 1.3%.

There will be no high-level data releases on the Japanese economic docket on Tuesday and risk perception is likely to remain the main theme of the market.

Technical levels

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