USD/JPY climbs to fresh daily highs above 108.00
- USD/JPY turned north after dropping to 107.70 area.
- US Dollar Index edges higher toward 91.00 after US data.
- 10-year US Treasury bond yield stays in the positive territory.
After closing the third straight week in the negative territory, the USD/JPY pair fell toward 107.70 but managed to stage a rebound in the early American session. As of writing, the pair was up 0.17% on a daily basis at 108.10.
USD/JPY continues to react to US T-bond yields
At the start of the week, the broad-based selling pressure surrounding the greenback forced USD/JPY to push lower. The US Dollar Index (DXY), which lost nearly 1% last week, touched its weakest level since early March at 90.68. Nevertheless, the rebound witnessed in the US Treasury bond yields provided a boost to USD/JPY. At the moment, the DXY is up 0.12% on the day and the benchmark 10-year US T-bond yield is rising 0.7%.
In the meantime, the data from the US showed that Durable Goods Orders expanded by 0.5% in March. Although this reading came in worse than the market expectation for an increase of 2.5%, the reaction was largely muted.
On Tuesday, the Bank of Japan (BoJ) will announce its Interest Rate Decision and release the Monetary Policy Statement. Previewing this event, "despite the March framework review, the adjustments were small and did not portend any imminent danger of BoJ lowering rates further," said UOB Group analysts. "We still expect BoJ to ease monetary policy further in the next MPM, most likely through reaccelerating its JGB purchases and expanding its lending facilities."
Technical levels to watch for