USD/JPY records fresh 2018 lows near 105.20

• Spot came under renewed selling pressure today around 105.20.
• USD-weakness and a pick up in risk-off trade stay behind the down move.
• US 10-year yields break below the 2.80% level, fresh 3-week lows.

The buying pressure around the Japanese currency is dragging USD/JPY to print fresh YTD lows in the vicinity of the 105.20 zone.

USD/JPY looks to risk trends, US data

The Japanese safe haven is appreciating to levels last seen in November 2016 just above the 105.00 handle following rising concerns over global trade and some hawkish (ish) views from BoJ’s Kuroda during the Asian trading hours.

In fact, risk-off sentiment quickly turned up among traders after President D.Trump said on Thursday the US will impose tariffs on its imports of steel and aluminum, hitting producers in Asia and Europe.

Adding to the buying interest in JPY, BoJ’s Governor H.Kuroda said earlier today that the central bank could consider a plan to exit its QQE programme when inflation figures hit the 2% target, which is expected to happen in FY2019.

Also weighing on the pair’s downside, yields of the key US 10-year benchamark has broken below the critical 2.80% handle, printing fresh 3-week lows at the same time.

Looking ahead, February’s final print of the US Consumer Sentiment tracked by the Reuters/Michigan index is only due in the NA session.

USD/JPY levels to consider

As of writing the pair is losing 0.81% at 107.36 and a breakdown of 105.28 (2018 low Mar.2) would aim for 102.54 (low Nov.3 2016) and then 101.15 (low Nov.9 2016). On the other hand, the next up barrier aligns at 106.79 (10-day sma) seconded by 107.59 (21-day sma) and finally 107.92 (high Feb.21).