AUD/JPY Cross Eyes BoJ Rate Hike Amid Bearish Bias

The AUD/JPY cross has been gaining traction, reaching near 110.90 in Thursday's early European session. However, despite this gain, the pair retains a bearish bias below the 100-day SMA.

The ongoing conflict in the Middle East continues to weigh on the Japanese Yen (JPY) due to Japan's oil-dependent economy, causing it to lose value against the Australian Dollar (AUD).

All eyes are on the Bank of Japan's (BoJ) monetary policy meeting on Friday, where traders expect a 25bps interest rate hike to 1.25%.

Analysts at Standard Chartered believe that the BoJ has room to move, given the economy's ability to absorb another modest hike, citing revised Q2 GDP growth and robust exports as evidence.