- Political worries undermine USD putting a lid on USD/JPY strength.
- Risk averseness helps JPY as safe-haven bids are piling in.
- NFP, election news main risk events ahead.
USD/JPY trades near multi-month lows around 103.35 after a failed attempt to move above 103.75 during the Asian session. The fresh supply near the day’s high pushed the pair to the lowest level since March 12.
The early rise was due to dollar demand, but safe-haven demand for JPY cut the bulls short. Later, the dollar demand got curtailed as Biden’s chances of securing the required majority to become the next US President went up.
Still, the results of a few battleground states are pending and a divided government among the Congress, Whitehouse and Senate wouldn’t help big fiscal spending hopes.
The lack of conviction among the market participants has prevented any more profound losses in the pair. USD/JPY, trading near mid-103.00s, will await the US monthly job numbers for directional clarity.
The payroll reports, along with political developments, will determine the dollar strength ahead along with global risk sentiments.
At the time of writing, one US dollar buys 103.39 Japanese Yens, down 0.05% as of 10:25 AM UTC.
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