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AUD/JPY extends gains after Australian economic data, trading near 97.10

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  • AUD/JPY moves above key 97.00 level after Australian economic data.
  • Australia’s consumer inflation expectations and unemployment rate remained consistent at 4.5% and 3.9% respectively.
  • The Japanese yen faces challenges as the BoJ is expected to maintain an ultra-dovish stance.

AUD/JPY is extending its gains for a second straight session, improving to near 97.10 during Asian trading hours on Thursday. The Australian dollar (AUD) is strengthening against the Japanese yen (JPY) following the release of economic data from Australia on Thursday.

Consumer inflation expectations It was unchanged at 4.5% in January and the seasonally adjusted unemployment rate was steady at 3.9%, in line with December expectations. Despite these stable indicators, data on changes in employment revealed a decline. The number of employed persons decreased by 65.1 thousand, in contrast to the expected increase of 17.6 thousand.

However, modest economic data could act as a deterrent for the Reserve Bank of Australia (RBA) to make any changes in monetary policy during the upcoming session, potentially curbing the upside momentum of the AUD/JPY pair. The RBA is expected to maintain a cautious stance with only two rate cuts expected for the rest of the year.

The current cash rate is now 4.34%, following a 25 basis point (bps) increase at the November Reserve Bank of Australia (RBA) meeting. Despite the increase,

On the Japanese side, the recent drop in inflation rates in Tokyo and the release of weaker wages data last week bolstered market expectations that the Bank of Japan (BoJ) would maintain its ultra-dovish stance. This, in turn, is seen as a significant factor undermining the strength of the Japanese Yen (JPY) and facilitating an upward move in the AUD/JPY pair.

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