AUD/JPY drops below 96.00 on BOJ intervention, RBA Lowe’s speech eyed
|- AUD/JPY has continued its three-day losing streak after dropping below 96.00.
- BOJ’s intervention in the Fx moves is not expected to be welcomed by the remaining G7 countries.
- RBA’s Lowe is expected to guide the likely monetary policy action in October.
The AUD/JPY pair is declining sharply since Thursday after failing to sustain above the critical resistance of 97.00 led by the warning from the Bank of Japan (BOJ) on potential intervention in the Fx moves in seldom to support the yen bulls. The cross has printed a fresh two-day low at 95.94 and has surrendered the cushion of 96.00. The asset has continued its three-day losing streak and will continue its falling spree until clarity over BOJ’s intervention plans.
The Japanese yen is falling like a house of cards for the past several months by keeping a strict prudent stance on its monetary policy. Japanese officials feel that the fundamentals of the economy don’t justify the downside pressure and have discussed intervention in Fx moves with the Bank of Japan (BOJ). A seldom decision of intervening is not expected to be welcomed by other G7 countries and changing stance on policy seems the potential way to provide a cushion to the falling yen.
Meanwhile, the aussie bulls have weakened on slightly lower-than-expected Australian employment data. The Employment Change data landed at 33.5k vs. the expectations of 35k and the layoff of 40.9k employees was reported in the July report. While the Unemployment Rate has increased to 3.5% against the forecast and the prior release of 3.4%.
This won’t allow the Reserve Bank of Australia (RBA) to move the needle towards higher interest rates without much hesitation. Going forward, the speech from RBA Governor Philip Lowe will be of utmost importance. RBA Lowe is expected to discuss the likely monetary policy action in October. Although, a target for the Official Cash Rate (OCR) has been set at 3.85%.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.