- USD/JPY eased back Tuesday from 105.75-80.
- Cautious mood is lifting the safe-haven JPY adding pressure
- USD is muted looking towards Powell’s speech.
The USD/JPY struck a daily low around-105.50s in early European trade paring gains from the previous session.
USD/JPY struggled to break through resistance at 105.80 before easing back on Tuesday. Japanese yen’s safe-haven demand was buoyed by a cautious mood in the market adding pressure to USD/JPY
Positivity surrounding US President Donald Trump’s discharge from hospital was overshadowed by political uncertainty ahead of the US elections. Optimism over a new coronavirus rescue package wasn’t able to lift investors’ sentiment.
A turn in US Treasury bond yields added to the bearish outlook. A weaker US dollar added further pressure to the USD/JPY pair and fuelled the intraday pullback of some25 pips from the daily highs.
Looking ahead, Fed Chair Jerome Powell is due to speak which could drive the pair, along with broader market risk sentiment, amid absence relevant macro data.