USD/JPY Rebounds Ahead of US NFP Data Amid Ongoing Bank Intervention
The Japanese yen's recent downward trend has resumed following interventions by the US and the Bank of Japan. The USD/JPY exchange rate plummeted to 155.20 earlier this week but rebounded to 158.41 as investors bought the dip ahead of the US nonfarm payrolls (NFP) data.
The Bank of Japan spent over $50 billion in interventions last week, bringing its total spending to over $120 billion this year. The US has an incentive to intervene since Japan is the biggest foreign holder of US debt, holding over $1.14 trillion in US debt.
Economists expect the NFP data to reveal that the economy added over 88k jobs last month, with the unemployment rate remaining at 4.2%. The Consumer Price Index (CPI) report is expected on Wednesday and will provide more information about the state of the economy.
A doji candlestick pattern formed on Monday, characterized by a small real body and long upper and lower shadows. This pattern often signals market indecision after a strong downtrend and can be viewed as an early bullish reversal signal.