USD/JPY fails to hold above 108, clings to small daily gains near 107.90
- 10-year US Treasury bond yield posts small losses on Monday.
- US Dollar Index inches higher above the 97 handle.
- Wall Street looks to open the day in the positive territory.
The USD/JPY pair started the week on a strong footing and climbed to its highest level in five days above the 108 mark. However, with the market action turning subdued in the absence of important macroeconomic data releases and any developments that could potentially impact the market's risk perception, the pair is now consolidating its losses and was last seen adding 0.2% on a daily basis at 107.92.
Meanwhile, the sharp fall witnessed in the 10-year US Treasury bond yield last week seems to have lost its momentum on Monday to help the pair limit its losses. At the moment, the S&P 500 Futures is up 0.25% on the day, suggesting that Wall Street could start the day in the positive territory and make it even more difficult for the safe-haven JPY to grab investors' interest in the second half of the day.
On the other hand, the US Dollar Index, which posted modest gains last week, is extending its recovery above the 97 handle, helping the pair stick to its gains. Ahead of the Chicago Fed's National Activity Index, the DXY is up 0.15% on the day at 97.22.
More importantly, investors will be paying close attention to Bank of Japan Governor Kuroda's speech at 15 GMT and look for clues regarding the BoJ's intentions to introduce more monetary stimulus.
Technical levels to watch for