- The Japanese Yen (JPY) is falling for a third day
- Chinese–Japanese tensions rise to the highest level since WW2
- The US Dollar (USD) rises against major peers
- US jobless claims beat forecasts ahead of tomorrow’s NFP
The US dollar Japanese yen (USD/JPY) exchange rate is rising for a third straight day. The pair rose 0.08% in the previous session, settling on Wednesday at 156.77. On Friday at 18:00 UTC, USD/JPY trades +0.04% at 156.83 and traded in a range of 156.46 to 157.07.
The yen is under pressure for a third day as Sino-Japanese tensions rise to the highest level since World War 2. China is ramping up economic and political pressure on Japan, announcing a ban on exports with dual military and civilian use, including rare earths. The move follows a diplomatic row with Tokyo over Prime Minister Takaichi’s comments last year about Taiwan.
Takaichi warned in November that a Chinese invasion of Taiwan could trigger a military response from Tokyo. For China, these comments constitute gross interference in China’s internal affairs.
The Nikkei fell 1.3%, extending Wednesday’s 1% loss in response to the brewing diplomatic row. The yen also weakened.
The US dollar is rising across the board. The US dollar index, which measures the USD against a basket of currencies, is up 0.29% to 98.97, marking a third day of gains.
The US dollar is edging higher against its major peers on Thursday as investors digest data ahead of tomorrow’s crucial nonfarm payroll report, which could help provide further clues over the future path for interest rates
Data released today showed that the number of Americans filing for unemployment benefits increased by 8,000 to 208,000 last week, a relatively low level. On Wednesday, data showed that job openings fell by more than expected, whilst hiring eased.
US nonfarm payroll figures tomorrow should provide further clues on how the jobs market is holding up and whether the market is still looking for two rate cuts this year.
