USD/JPY bulls pause below 108.00 on BOJ’s status-quo
- USD/JPY drops after BOJ’s emergency meeting.
- BOJ cited virus outbreak fears, shows readiness to act.
- US-China tussle intensifies with latest statements from National People's Congress.
USD/JPY drops from 107.72 to 107.60 after the BOJ’s inaction during the early Friday. The Japanese central bank left monetary policy unchanged during the surprise meeting while announcing targeted aids for the small and mid-sized firms.
The BOJ meeting wide market expectations of no change in the short-term interest rate or the Japanese Government Bond (JGB) yield target while announcing 75 trillion loans to combat the coronavirus (COVID-19).
Read: Breaking: BoJ maintains short-term interest rate target at -0.1%
Other than the BOJ, the recently worrisome headlines from China’s 13th National People's Congress concerning Hong Kong also weigh on the market’s risk-tone.
Earlier during the day, the US Senate Majority Leader McConnell said that further China crackdown on Hong Kong will intensify the Senate’s interest in re-examining the US-China relationship.
That said, the US 10-year treasury yields remain soft near 0.675% whereas Japan’s NIKKEI drop 0.18% to 20,510 by the press time.
Technical analysis
An ascending trend line from May 07, at 107.55 now, can check sellers during the further declines while highs marked during mid-April and May 19, around 108.10, become the key resistance.