North American FX Open - Usd/Jpy recovers after hitting its lowest level since June 7th

The Dollar remained under pressure overnight, after yesterday's fall in yields and the Trump currency comments, with Usd/Jpy at one stage slipping down to 155.38, its lowest level since Jun 7th. US 10 year yields have recovered from yesterday's dip below 4.15%, which has helped lift Usd/Jpy back above 156.00. Reuters reported that the latest BoJ data does not immediately show any evidence of intervention yesterday.

Aussie Dollar longs will be concerned that despite the release overnight of the impressive Australian jobs report for June, the currency is still the worst performing G10 unit so far this week.

50.2k jobs were created in June, with further good news coming from the fact that 43.3k of them were full time roles. The unemployment rate did tick up to 4.1% as expected, but that is only 0.6% above the record lows in 2022.

The head of labor statistics at the Australian Bureau of Statistics pointed to the fact that the employment-to-population ratio and participation rate both rose by 0.1 percentage point to 64.2% and 66.9% respectively, which are both near their 2023 highs, as well as the continued high level of job vacancies as signs that the labor market remains relatively tight.

The other major data update overnight came from the UK, where average earnings matched expectations by coming in at 5.7%.

Today's main event is the ECB monetary policy decision, where an unchanged verdict is universally expected. The big question is whether the Bank's president Lagarde will hint at a reduction in September.

US numbers include the Philly Fed survey and jobless claims.

Fed speakers include, Goolsbee, Logan and after hours Daly.

Noted Fed watcher Grep Ip at the WSJ argued that the Fed should cut rates later this month and not wait until September. He declared that if the Fed was truly data-dependent and trusted their own forecasts they would be comfortable cutting rates now, as accelerating inflation looks like a lesser risk than a weakening labor market.

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