USD/JPY – Japanese yen gains ground on soft U.S jobs report

USD/JPY has posted losses in the Tuesday session, continuing the downward movement seen on Monday. In the North American session, the pair is trading at 111.06, down 0.38% on the day. On the fundamental front, U.S. JOLTS Jobs Openings dropped sharply to 7.09 million, down from 7.58 million a month earlier. This reading was well short of the forecast of 7.54 million. Later in the day, Japan releases Core Machinery Orders, which is expected to rebound with a gain of 3.0%. As well, PPI is projected to improve to 1.0%. On Wednesday, the U.S. releases consumer inflation data. CPI is expected to improve to 0.3% and Core CPI is projected to climb to 0.2%. As well, the FOMC releases the minutes of the March policy meeting.

On Wednesday, investors will be keeping a close look at Federal Reserve, which releases the minutes of the March meeting. At the meeting, the Fed said it would start tapering the reduction of its balance sheet in May. This marks a loosening of policy, and comes in response to weaker economic data out of the U.S. in recent months. The minutes should be treated as a market-mover, and if investors don’t like what they hear, risk apprehension could jump and the safe-haven yen could gain ground.

The Japanese economy remains fragile, as weak global demand has taken a toll on Japanese exports and manufacturing output. This was reflected in a Bank of Japan forecast on Monday, which downgraded its assessment for three of the country’s nine regions. All three regions are dependent on electronic exports to China, which has been gripped by an economic slowdown in recent months. Despite the pessimistic report, BoJ Governor Haruhiko Kuroda remained optimistic, saying that stronger domestic demand would offset the decline in exports, which would enable the economy to grow at a moderate pace. Kuroda also said that he was confident that inflation would gradually accelerate towards the BoJ’s target of 2 percent.

FX rumbles as the street slumbers

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Tuesday (April 9)

  • 6:00 US NFIB Small Business Index. Estimate 101.3. Actual 101.8
  • 10:00 US JOLTS Job Openings. Estimate 7.54M. Actual 7.09M
  • Tentative – US IBD/TIPP Economic Optimism. Estimate 53.2
  • 17:00 US FOMC Member Quarles Speaks
  • 18:45 US FOMC Member Clarida Speaks
  • 19:50 Japanese Bank Lending. Estimate 2.3%
  • 19:50 Japanese Core Machinery Orders. Estimate 3.0%
  • 19:50 Japanese PPI. Estimate 1.0%

Wednesday (April 10)

  • 2:00 Japanese Preliminary Machine Tool Orders
  • 8:30 US CPI. Estimate 0.3%
  • 8:30 US Core CPI. Estimate 0.2%
  • 14:00 US FOMC Meeting Minutes

*All release times are DST

*Key events are in bold

USD/JPY for Tuesday, April 9, 2019

USD/JPY April 9 at 10:35 DST

Open: 111.49 High: 111.58 Low: 110.98 Close: 111.06

USD/JPY Technical

S3 S2 S1 R1 R2 R3
109.37 110.28 110.90 112.16 112.93 113.70

USD/JPY posted small losses in the Asian and European sessions. The downward movement continues in North American trade

  • 110.90 is a weak support level
  • 112.16 is the next resistance line
  • Current range: 110.90 to 112.16

Further levels in both directions:

  • Below: 110.90, 110.28, 109.37 and 108.11
  • Above: 112.16, 112.93 and 113.70

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.