AUD/JPY moves below 104.50 after China decides to hold interest rates

Source Fxstreet
  • AUD/JPY lost ground due to possible risk aversion sentiment.
  • The Australian Dollar pared its gains after China's interest rate decision.
  • PBOC maintained the one-year and five-year LPR at 3.45% and 3.95%, respectively.

AUD/JPY has trimmed its intraday gains, trading around 104.20 during the European session on Monday, amid a risk aversion sentiment. Earlier in the day, the Australian Dollar (AUD) appreciated but later pared its gains following China's interest rate decision. The People's Bank of China (PBOC) maintained the one-year and five-year Loan Prime Rates (LPR) at 3.45% and 3.95%, respectively. Traders are now awaiting the Reserve Bank of Australia's (RBA) Meeting Minutes, which are set to be released on Tuesday.

The Australian Dollar could encounter obstacles as the yield on Australia's 10-year government bond hovers around 4.2% at its lowest level in a month. This decline in bond yields comes in the wake of a softer domestic jobs report for the first quarter. Sluggish wage growth has led markets to diminish the likelihood of any interest rate hikes by the Reserve Bank of Australia (RBA).

On the JPY front, the significant interest rate differential between Japan and other countries exerts selling pressure on the Japanese Yen (JPY) and boosts the AUD/JPY cross. The Bank of Japan (BoJ) abandoned the negative interest rate policy in March. Moreover, traders speculate that the BoJ might reduce bond purchases at the June policy meeting. BOJ Governor Kazuo Ueda also indicated that there are no immediate plans to sell the central bank’s ETF holdings.

The findings of a survey conducted by the Bank of Japan (BoJ) to evaluate its past monetary easing measures showed that Japan is on the brink of witnessing significant changes in corporate activity. Many firms stated that they are unable to hire enough workers if they cut wages. Additionally, more firms are beginning to pass on rising labor costs to sales prices. Manufacturers identified FX stability as the most crucial factor they desired from the BoJ’s monetary policy.

AUD/JPY

Overview
Today last price 104.2
Today Daily Change 0.04
Today Daily Change % 0.04
Today daily open 104.16
 
Trends
Daily SMA20 102.23
Daily SMA50 100.27
Daily SMA100 98.82
Daily SMA200 97.23
 
Levels
Previous Daily High 104.3
Previous Daily Low 103.63
Previous Weekly High 104.3
Previous Weekly Low 102.6
Previous Monthly High 105.04
Previous Monthly Low 97.78
Daily Fibonacci 38.2% 104.04
Daily Fibonacci 61.8% 103.88
Daily Pivot Point S1 103.76
Daily Pivot Point S2 103.36
Daily Pivot Point S3 103.09
Daily Pivot Point R1 104.43
Daily Pivot Point R2 104.7
Daily Pivot Point R3 105.11

 

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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