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USD/JPY bulls look seize control above 144.00, focus remains on key US macro data

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  • USD/JPY attracts some follow-through buyers for the second straight day on Tuesday.
  • Fed Chair Powell’s hawkish remarks on Monday underpin the USD and lend support.
  • The uncertainty over the BoJ’s rate-hike path contributes to the modest intraday uptick.

The USD/JPY pair is seen building on the overnight goodish bounce from the 141.65 area, or a nearly two-week low and gaining traction for the second straight day on Tuesday. The move-up lifts spot prices beyond the 144.00 mark during the Asian session and is sponsored by a combination of factors. 

The US Dollar (USD) draws support from the Federal Reserve (Fed) Chair Jerome Powell's relatively hawkish tone on Monday, which forced investors to scale back their bets for another oversized rate cut in November. The Japanese Yen (JPY), on the other hand, remains on the defensive in the wake of comments from Japan's incoming Prime Minister (PM) Shigeru Ishiba, saying that the Bank of Japan's (BoJ) monetary policy must remain accommodative to underpin a fragile economic recovery. 

Furthermore, Ishiba said on Monday that he intends to call a general election on October 27. Apart from this, the underlying bullish sentiment across the global financial markets is seen undermining demand for the safe-haven JPY and acting as a tailwind for the USD/JPY pair. The JPY bulls remained on the sidelines after BoJ's Summary of Opinions from its September meeting revealed that the central bank will adjust its accommodative stance if economic conditions improve.



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