Abstract:AUD/JPY rises to the fresh 26-month high above 83.00 following upbeat Aussie Wage Price Index
AUD/JPY rises for the fifth consecutive day after upbeat employment data from Australia.
Australias Wage Price Index grew better than forecast 0.3% QoQ during fourth-quarter (Q4).
Risks dwindle as Feds Powell failed to placate bond bears, vaccine optimism also fails to tame the cautious mood.
US stimulus gridlock continues, Japan is up for removing emergency from seven prefectures earlier than planned.
AUD/JPY rallies to the intraday high of 83.45, up 0.10% on a day, while cheering welcome Wage Price Index for Australia during Wednesdays Asian session. In doing so, the quote marks a five-day uptrend while staying near the highest since December 2018.
Australias Q4 Wage Price Index grew past-0.3% forecast and 0.1% prior to +0.6% QoQ. The key economic data also reprint 1.4% figures for YoY versus downbeat expectations of 1.1%. Further details suggest, Construction Work Done dropped below 1.0% market consensus but recovered from -1.8% upward sly revised prior.
Given the mostly strong data, Australian dollar buyers gained extra support to keep their north-run direction towards the 2018 highs.
However, the latest shift in the market‘s mood seems to challenge the AUD/JPY bulls. Wall Street closed mixed and the US 10-year Treasury yields struggled for further traction to the north after Federal Reserve Chairman Jerome Powell cited fears of coronavirus (COVID-19)-led economic slowdown. However, the Fed’s readiness to extend easy money policies and tame the reflation fears seemed to have probed the risk-off mood.
As a result, S&P 500 Futures recovers early Asian losses while trying to regain the 3,900 threshold, currently around 3,875. Further, the US 10-year Treasury yields drop 1.6 basis points (bps) 1.348% by press time. It should be noted that Japan‘s Nikkei 225 mark near 1.0% losses after the previous day’s holiday whereas Australias ASX 200 also drop 0.40% amid cautious optimism.
Other than Powell, AstraZeneca‘s news of 94% success in reducing hospitalization and Japan’s readiness to take back virus-led restrictions from seven prefectures seemed to have helped the risks off-late.
Looking forward, Powells testimony 2.0 and updates concerning the US covid stimulus will be the key amid a light calendar.
Technical analysisBulls can keep eyes on the December 2018 peak surrounding 83.90 unless the quote drops back below January tops of 80.92.
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