USD/JPY set to break below 109.00 to test the 108.70 support

USD/JPY trades near a daily low of 109.05 and a challenge of 109.00 is on the cards. Valeria Bednarik, Chief Analyst at FXStreet, believes the pair is poised to extend its decline, weighed by softer US Treasury yields.

BoJ Minutes showed no aims to change the ongoing monetary policy

“The greenback on the echoes of US Federal Reserve policymakers´ comments, which reaffirmed that inflation spikes would likely be temporary, adding that they will maintain the ultra-loose monetary policy in place until noting clear substantial progress toward the central bank’s goals. US Treasury yields keep retreating, adding pressure on the pair.”

“The Bank of Japan published the Minutes of its latest meeting, which brought no surprises. The central bank will maintain its quantitative easing, despite some members expressed concerns about its effects on the financial system in the long run.”

“The US will publish Q1 Challenger Job Cuts and Nonfarm Productivity and Initial Jobless Claims for the week ended April 30, foreseen at 540K.”

“The near-term picture for USD/JPY is bearish, with room for a steeper slide once below the 108.70, the immediate support level.”