USD/JPY pares daily losses, closes in on 110.00
- Rising US T-bond yields helps USD/JPY erase its losses.
- US Dollar Index stays in the negative territory below 92.50.
- Eyes on CB Consumer Confidence data from US.
The USD/JPY pair dropped below 109.80 during the European trading hours but didn't have a difficult time erasing its losses. As of writing, the pair was virtually unchanged on a daily basis at 109.94.
US T-bond yields edge higher ahead of mid-tier US data
On Monday, the risk-positive market environment didn't allow the JPY to gather strength and USD/JPY ended up closing the day flat. Although the USD seems to have gone under renewed selling pressure on Tuesday, rising US Treasury bond yields help the pair limit its losses. Currently, the benchmark 10-year US Treasury bond yield is up more than 1% on the day while the US Dollar Index is losing 0.3% at 92.42.
Later in the session, the Conference Board will release the Consumer Confidence data for August. Earlier in the month, the University of Michigan reported a sharp decline in the Consumer Sentiment Index for August and a similar reading could hurt the greenback as it would point to a possible delay in asset tapering.
Other data releases featured in the US economic docket will include Housing Price Index, S&P/Case-Shiller Home Price Indices for June and the ISM Chicago's Purchasing Managers' Index for August.
During the Asian trading hours on Wednesday, Jibun Bank Manufacturing PMI and second-quarter Capital Spending data from Japan will be looked upon for fresh impetus.
Technical levels to watch for