AUD/JPY stalls two-day winning streak, under 69.00, after Japanese data
- AUD/JPY remains mildly negative in recent hours.
- Japan’s National CPI remains soft, NIKKEI, S&P 500 Futures register smaller losses.
- The US alleges China for the virus outbreak, a $484 billion stimulus about to rollout.
- BOJ expectations, absence of pandemic cure weigh on the risk-tone.
With its recent declines from 68.70 to 68.45, AUD/JPY snaps the previous two-day winning streak, down 0.15% on a day, amid the initial hour of Tokyo open on Friday.
Japan’s National Consumer Price Index (CPI) and National CPI ex-Food & Energy matched the respective priors of 0.4% and 0.6% on YoY for March. However, the Corporate Service Price Index (YoY) slipped beneath 2.1% to flash a 1.5% mark.
Given the downbeat inflation figures and pessimism concerning the coronavirus (COVID-19) outbreak in Japan, the BOJ is more likely to discard its bond purchase limit during Monday’s meeting, as suggested by NIKKEI.
While the news should ideally propel the quote, the fresh risk-reset seems to please the sellers.
The recent pullback in risk-on sentiment could be attributed to the US policymakers’ allegations that China didn’t report virus outbreak to the World Health Organization (WHO) on time. Also contributing to the mood is the failure of the Gilead’s Remdesivir to provide upbeat results in curing the COVID-19 during the first trial.
On the contrary, US President Trump praised the flattening of the curve and pushed further for the economy to re-open while the House passed a $484 billion aid package for small businesses, hospitals and testing. Additionally, the US Federal Reserve also took steps to facilitate lending to small businesses to better combat the epidemic.
Looking forward, a lack of major data ahead of the US session, coupled with the recently downbeat performance of the markets may weigh on the quote. However, Australia’s ability to register a comparatively well recovery from the virus outbreak, together with New Zealand, might favor the quote in a case of any surprise positive announcements.
Technical analysis
Buyers will look for fresh entries beyond the monthly high near 69.30, until then 21-day SMA level of 67.50 remains on the bears’ radars.