USD/JPY backs off three-week high
USD/JPY tilted lower in Asian trade off September 14 highs following earlier Japanese data and ahead of US data today.
As of 06:55 GMT, USD/JPY fell 0.01% to 105.96, with an intraday low at 105.93.
Earlier Japanese data showed the current account surplus up to 1.65 trillion yen from 0.96 trillion in July, beating estimates of 1.5 trillion.
An index tracking Japan's current conditions rallied to 49.3 from 43.9 in August, while futures conditions rose to 48.3 from 42.4.
From the US, unemployment claims for the week ending October 3 are expected down 17 thousand to 820 thousand, while continuing claims are expected down 367 thousand to 11.4 million.
The US dollar slipped against most of its major counterparts on Wednesday, to pare its early gains, despite the release of better-than-expected economic data in the US. Investors are focusing on the ongoing debate between the White House and Congress about the second Covid-19 stimulus package. Johnson & Johnson announced this week pausing the clinical trials for its COVID-19 vaccine candidate after an unexplained illness in one of the volunteers. Data showed today that the US producer price index rose 0.4% in September, beating forecasts of 0.2%. The core reading (excluding food and fuel prices) also rose by 0.4%, better than forecasts of 0.2%. The dollar index fell against a basket of currencies by 0.2% to 93.3 points as of 20:00 GMT, after it hit a high of 93.6 and a low of 93.2.
The Australian dollar inched higher on Monday, amid the continued optimism about the US second fiscal stimulus package to ease the coronavirus impact. This came despite the release of the actual reading of China GDP, which came in at 4.9% during the third quarter, below expectations of 5.5%, vs. 3.2% during the second quarter. The Donald Trump administration proposed a $1.8 trillion fiscal stimulus package to mitigate the coronavirus impact. The Trump administration will try to reach compromise with the US congressional leaders in order to pave the way for an agreement on the package ahead of the November election. As of 17:57 GMT, AUD/USD rose 0.1% to 0.7089, after hitting a high of 0.7116, and a low of 0.7072.
The US dollar fell against a basket of major currencies on Tuesday, to deepen its losses for the third straight day, and hit a 1-week low, as demand slowed following the latest positive developments in the ongoing US political talks about the new Covid-19 aid package. The dollar index fell 0.3% to a 1-week low of 93.15 points, after it opened at 93.42 points, and hit an intraday high of 93.50 points. The index lost 0.3% yesterday, and posted its second straight daily loss, due to profit-taking from a 2-week high of 93.91 points. Alongside profit-taking the greenback was weighed down after data showed better-than-expected data in China, in addition to positive remarks about the Covid-19 aid program in the US. The US House of Representatives spokesman Drew Hamill said on Monday that House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin continued to narrow their differences on the aid package in a telephone conversation. Hamill added that by the end of Tuesday there will be clarity on whether the aid bill can be passed before the November 3 presidential election.