USD/JPY retreats from fresh cycle highs following US labour market figures

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On Tuesday, the USD/JPY reversed its course after rallying to a cycle high of 147.35 and settled below 146.00 at 145.95. On the US side, weak labour m

arkets were reported, but on the positive side, optimistic Housing data was released. On the other hand, Japan reported weak labour market figures, which reminded investors about the Bank of Japan's dovish stance.

The JOLTs Job Openings from the United States came in lower than expected in July. The figure came in at 8.82 million, while the markets expected a reading of 9.465 million and decelerated from the last revised reading of 9.165 million. Additionally, S&P/Case-Shiller Home Prices increased by 0.3% vs 0.2% but still came in below the previous figure of 0.7%. As a reaction, the USD measured by the DXY index retreated towards 103.90, accompanied by a sharp decline in US bond yields.

On the Japanese side, the unemployment rate rose to 2.7% in July, beating the expected 2.5%, while the job-to-applicant ratio fell to 1.29, lower than the expected 1.30, and suggests that the labour market is weakening. It is worth noting that thehas made it clear that until local wage and inflation metrics are aligned, any monetary policy pivots will be withheld.

 

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