On Monday, the United States Dollar bounced a bit higher against the Japanese Yen, but the move looks corrective and comes on the back of scant economic news.
The minimal relaxation of banking-sector jitters may have assisted the greenback by a bit more stability in Treasury yields.
Investors worried that European titan Deutsche Bank might be unpleasantly exposed to tightening monetary conditions in the previous week, but those worries might have waned as a new trading week gets underway, with that lender joining the sector in broad-based gains.
Reports that First Citizen Bank will acquire what’s left of troubled Silicon Valley Bank seem to have been taken well by stock markets.
Neel Kashkari, the Minneapolis Federal Reserve President stated during the weekend that a credit crunch might delay the economy and that the Fed was closely monitoring it, but it’s most probably not great news to markets.
USD/JPY has moved above the psychologically important 131.00 handles in European trading Monday but doesn’t yet look very comfortable up there. The day doesn’t promise many data-related trading opportunities.
These will likely have to expect Thursday, when we’ll see the final official look at US Gross Domestic Product data for the old year’s last three months, along with plentiful Japanese numbers from retail sales to industrial production.
China’s manufacturing Purchasing Managers Index might also be related to the pair, due to its bearing on Japan’s huge export sector.
Still, the lasting impact of all of these is likely to be short on USD/JPY. Interest-rate prospects and the health of the banking sector will continue to provide the background music for this pair.