USD regains demand with safe haven, JPY, as developments on pandemic and oil prices emerge

  • USD/JPY currently recovered at 107.78 from 107.50 on Thursday in Asia. What appeared to have influenced this pair’s recent dynamics are the varying runs between the pandemic and a lull in oil meltdown.

     

    A Favorable Pause on Oil Prices Decline

    The oil prices have likely sparked renewed hopes in economy and recovery in securities. An improvement in the global indexes has been prompted with the stabilized oil prices, following two days of decline.

    Although Wall Street is seemingly recuperating, pleasing several traders, this is still not an indication of risk-on. Oil majors are yet to show actual efforts in sustaining investors’ confidence despite demonstrating readiness to do so.

     

    On COVID-19 Pandemic

    Virus updates stay crucial in Asia as the pandemic challenges are not yet over. Developments on South China Morning Post (SCMP) reignited anxiety of a more extensive outbreak as the Chinese presume that the virus has mutated quickly. 

    Thus, the dollar with haven bids attached to the S&P 500 is signaling a loss in Asia of 0.45%. Therefore, for the time being, more alleviation measures are being declared around the world. 

    On the flip side, hopes of economic recovery are around the corner as the curves are flattening in the US, which prompts mild ease.

     

    USD Against Growth Currencies

    While the greenback is attracting bids against growth currencies, it is still battling to keep an upside momentum versus safe havens such as JPY.

    The USD/JPY pair is trading with marginal gains at 107.83, in contrast to the risk-sensitive pairs such as AUD/USD and NZD/USD, currently down at 0.40% and 0.47%, respectively.

    GBP/USD recouped the 1.2300 level, however could not expand gains past it.

    AUD/USD additionally progressed, yet dulled support as investors stay cautious.

    As the dollar strength poses a challenge in lifting the USD/JPY pair, the Bank of Japan (BOJ) is intending to add more to its current stimulus.

     

     

    Risk Disclaimer:
    Information on this page are solely for educational purposes only and is not in any way a recommendation to buy or sell certain assets. You should do your own thorough research before investing in any type of asset. Learn to Trade does not fully guarantee that this information is free from errors or misstatements. It also does not guarantee that the information is completely timely. Investing in the Foreign Exchange Market involves a great deal of risk which may result in the loss of  a portion or your full investment. All risks, losses and costs associated with investing, including total loss of principal and emotional distress, are your responsibility.

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