Japanese Yen Struggles To Gain Ground Ahead Of Jibun Bank Services PMI Data -

Japanese Yen Struggles To Gain Ground Ahead Of Jibun Bank Services PMI Data

Dec 03, 2024Jeremy ParkinsonFinance0

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The Japanese Yen loses ground amid the stronger USD in Wednesday’s early Asian session.

Growing expectations of the BoJ rate hike in December and safe-haven flows might help limit the JPY’s losses.

Investors brace for Japan’s Jibun Bank Services PMI, US economic data and Fed’s Powell speech on Wednesday.

The Japanese Yen (JPY) trades in negative territory on Wednesday. The upbeat US Manufacturing PMI data and job openings data this week indicated that the US economy remains robust, lifting the Greenback. However, traders are increasingly confident that the Bank of Japan (BOJ) may hike interest rates this month. This, in turn, might support the JPY in the near term.

Furthermore, the ongoing political uncertainty in France, the political tension in South Korea and escalating geopolitical risks in the Middle East could boost the safe-haven flows, benefitting the JPY against the USD. Investors will keep an eye on the final reading of Japan’s Jibun Bank Services PMI, which is due later on Wednesday. On the US docket, the ADP Employment Change report, final S&P Global Services PMI, ISM Services PMI and the Fed’s Beige Book will be released. The Federal Reserve’s (Fed) Chair Jerome Powell is scheduled to speak later in the same day.

Japanese Yen edges lower amid the firmer US Dollar broadly

The BoJ Governor Kazuo Ueda said on Saturday that the central bank will adjust the degree of monetary easing at the appropriate time if it becomes confident that the underlying inflation rises toward 2%.

The US JOLTS Job Openings rose to 7.74 million in October, compared to 7.37 million openings in September, according to the US Bureau of Labor Statistics (BLS) on Tuesday. This reading came in higher than the market expectation of 7.48 million.

Fed Governor Adriana Kugler said the labor market remains solid, and inflation appears to be on a sustainable path to the Fed’s 2% target. However, Kugler underscored that the central bank’s policy decisions are not on a preset course.

San Francisco Fed President Mary Daly stated that an interest rate cut in the December meeting isn’t certain but remains on the table for policymakers.

Chicago Fed President Austan Goolsbee noted he expects interest rates will “come down a fair amount from where they are now” over the next year, per Bloomberg.

USD/JPY turns bearish in the longer term
The USD/JPY pair keeps the bearish vibe on the daily chart as the pair remains capped below the key 100-day Exponential Moving Average (EMA). The 14-day Relative Strength Index (RSI) stands below the midline near 38, indicating the further downside for the pair looks favorable.

A break below the lower Bollinger Band of 149.33 could set off an even steeper slide for the pair to 147.18, the high of September 2. Further south, the next support level is seen at 143.62, the low of August 6.

On the brighter side, the crucial resistance level emerges at the 150.00 psychological mark. Sustained upside momentum could even take it all the way to the next hurdle at 154.70, the high of November 6. A decisive break above the mentioned level could attract enough bullish energy to lift USD/JPY back up to 155.89, the high of November 20.
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