Currency markets saw significant movement on Tuesday, with the USD/JPY pair breaking through a key psychological level. The pair had been hovering around 155 in Asian and early European trading before finally surpassing it at the start of US trading. This move was supported by earlier comments from an LDP official suggesting that intervention was not being considered at the moment.
The initial突破above 155.00 was brief, but the retracement held at 154.75, indicating a lack of significant resistance. A second push later took the pair as high as 155.37.
The Canadian dollar also exhibited strength, rising by 40 pips to 1.3725 against the US dollar. This gain was attributed to a weaker-than-expected February and March advance retail sales report, suggesting a weakening consumer outlook.
However, the US dollar experienced a late-day decline, aiding the pound in reaching a session high and the euro in recovering to an unchanged level. This occurred despite a broader rise in sovereign yields, including a 13 bps increase in Italian 10s. These yield increases moderated later in the day, partially due to a successful US 5-year sale.
Looking ahead, investors will be closely monitoring tomorrow’s US GDP report and weekly initial jobless claims data. These data releases will provide further insights into the economic landscape and potentially influence currency market sentiment.
