The recent jawboning from Japanese authorities, showing readiness to intervene in the markets to address any excessive falls in the domestic currency, helps limit the downside for the Japanese Yen.
Japan's Prime Minister Fumio Kishida said on Friday that excessive volatility in currency rates is undesirable and warned that authorities will use all available means to deal with excessive JPY falls.
Japan Finance Minister Suzuki reiterated on Monday that FX needs to move stably reflecting fundamentals and he won't rule out any option, and will deal appropriately with FX moves.
The Bank of Japan's (BoJ) cautious approach, indicating that accommodative financial conditions will be maintained for an extended period, fails to assist the JPY in attracting any meaningful buying.
Moreover, data released on Monday showed that inflation-adjusted real wages for Japanese workers fell in February for the 23rd consecutive month and further contributed to keeping a lid on the JPY.
The optimism over talks on a potential Israel-Hamas ceasefire remains limited in the wake of Israeli Prime Minister Benjamin Netanyahu's threat of a ground invasion in the southern Gaza city of Rafah.
The upbeat US jobs report released on Friday, along with the recent hawkish remarks by Federal Reserve officials, keeps the US Treasury bond yields elevated and acts as a tailwind for the US Dollar.
The US Treasury bond yields climbed to their highest levels since late November as investors continue scaling back their bets for how deeply the Fed will be able to cut interest rates this year.
Chicago Fed President Austan Goolsbee on Monday acknowledged that the US economy remains strong, but wondered how long the central bank can be restrictive without it damaging the economy.
Minneapolis Fed President Neel Kashkari said that the central bank cannot stop short on the inflation fight and that the labor market is not red hot like it was 12 months ago but its still tight.
Edited 09 Apr 2024, 13:27
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