Another Safe-haven assets other than gold is yen. Lately, yen are quite superior and attract current market players. The warming of political conditions in some countries made the yen chosen by investors.
Quoting Bloomberg on Wednesday (8/5), at 10:30 a.m. WIB, the USD / JPY currency pair weakened 0.15% to 0.1600.
It is said that with heated geopolitical conditions, the yen is now flooded with buyers. Even the yen is preferred over the US dollar because of trade wars.
Just a note, in the two-day interest rate review that ended March 15, the Bank of Japan (BOJ) maintained monetary policy to remain stable despite trimming its assessment of exports and output amid rising global economic risks.
According to our source, President Donald Trump’s statement about the 25% increase in import tariffs on Chinese goods was enough to shake the market.
“Global economic growth is feared to be dragged down as well. So that the yen is considered to have a lower risk,” said Sakti.
We also projected USD / JPY pairing will move in the range of 109.98 to 110.69. From a technical standpoint, JPY-based cross forex is still diverse and has limited potential for weakness.
Volatility also decreases with the downward direction. Indicator VI leads down too. While the TSI indicator leads down. So it is recommended that the selling price is below 109.98 and buy above 110.70.
European equity markets are falling early in the session as the euro continues to rise to more than $ 1.20 in the aftermath of the European Central Bank meeting. Mario Draghi vaguely mentioned a slowdown in asset purchases, which was enough to boost the growth of the single currency.
In addition, European stock markets are picking up on their momentum at the start of the yesterday session, investors are still rather confident as the US Congress and the White House have reached an agreement to raise the US federal debt ceiling for three months. This makes continuation of positive sentiment to Eurozone.
China, book and boreholes
At the economic level, China’s foreign trade figures for August were mixed. Imports jumped 13.3% but exports slowed significantly with 5.5% growth. The pound sterling rose slightly as manufacturing output grew 0.5% in July in the UK, better than expected. On the other side of the Atlantic, investors will pay close attention to the monthly report on employment in Canada (2.30 pm), a speech by a member of the US Federal Reserve (2:45 pm), inventories of wholesalers in the United States (4 pm) and the weekly evolution of the number of oil drilling in North America (19h).
Reference rates down
In the bond markets, benchmark rates continue to decline. The yield on the 10-year Bund returned 0.3% for the first time since June. In the United States, the 10-year Treasury yields only 2.02%, the lowest since the election victory of Donald Trump last November.