The USD/JPY pair holds its position near a 38-year high of 161.75.
The Jibun Bank Japan Services PMI was revised downward to 49.4 in June, marking a reversal from May's 53.8.
The US Dollar edges higher due to a recovery in yield on 2-year Treasury bond.
The Japanese Yen (JPY) continues to hold losses on Wednesday, remaining near its low of 161.75, a level not seen since 1986, recorded in the previous session. This decline can be attributed to final data indicating that Japan's business activity turned contractionary in June. Market participants focus on the possibility of foreign exchange (FX) intervention from the Bank of Japan (BoJ), which could support the JPY and limit the upside of the USD/JPY pair.
Japan’s 10-ear government bond yield increased to a near 13-year high of 1.11%. Traders continue to evaluate the Bank of Japan's monetary policy outlook amid a sharply depreciating Japanese Yen, which drives up import costs and contributes to inflationary pressures. Additionally, the central bank also announced plans to unveil a strategy for winding down its bond-buying program in July.
The US Dollar (USD) halted its four-day losing streak due to a recovery in yield on a 2-year Treasury bond, which stands at 4.75% at the time of writing. Traders await the release of the US ADP Employment Change, ISM Services PMI for June, and the FOMC Minutes scheduled for Wednesday.
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