- USD/JPY is rising for the second straight trading day on Monday.
- US Dollar Index clings to modest daily gains.
- Focus shifts to June CPI data from US.
The USD/JPY pair started the new week in a calm manner and spent the European trading hours moving sideways a little above 110.00. With the greenback starting to gather strength in the second half of the day, the pair edged modestly higher and was last seen trading at 110.35, rising 0.18% on a daily basis.
DXY pulls away from daily highs, stays in the green
In the absence of significant macroeconomic data releases, the USD’s market valuation remained the primary driver of USD/JPY’s movements. The cautious market mood ahead of this week’s key data releases and events helped the greenback find demand on Monday and the US Dollar Index (DXY) climbed to a daily high of 92.42 before going into a consolidation phase. At the moment, the DXY is up 0.17% at 92.25.
The decent demand witnessed in the 10-year US Treasury note auction on Monday didn’t allow the benchmark 10-year US T-bond yield to push higher following Friday’s strong rally and limited the USD’s gains.
On Tuesday, the US Bureau of Labor Statistics will release the Consumer Price Index (CPI) data for June. Investors expect the CPI to decline to 4.9% on a yearly basis from 5% in May. A higher-than-expected print could provide a boost to the USD and vice versa.
Later in the week, FOMC Chairman Jerome Powell will present the Fed’s semiannual report on the state of the US economy in a two-day testimony.