On the first day of a new trading week, the pair was faced with new supply, and it has now given up a significant portion of its Friday gains. The riskoff trend in the markets, which tends to boost the safe-haven Japanese yen, fueled the first day of a negative move in the previous three. The fastspreading Delta variation and a global economic recession continue to worry investors. This, combined with the imminent disaster at leveraged developer China Evergrande, dampened risk appetite.
Politics has contributed to the uncertainty ahead of Canada's and Germany's federal elections this week. As a result, the market's attention is drawn to the crucial FOMC monetary policy meeting, which begins on Tuesday. Investors will be looking for signals regarding the expected timing of the tapering of bond purchases, which will have a significant impact on near-term USD price dynamics and give the USD/JPY pair a new directional impetus. Meanwhile, in the absence of important market-moving economic reports on Monday, traders will look to broader market risk sentiment and US bond yields for potential short-term trading opportunities.
Politics has contributed to the uncertainty ahead of Canada's and Germany's federal elections this week. As a result, the market's attention is drawn to the crucial FOMC monetary policy meeting, which begins on Tuesday. Investors will be looking for signals regarding the expected timing of the tapering of bond purchases, which will have a significant impact on near-term USD price dynamics and give the USD/JPY pair a new directional impetus. Meanwhile, in the absence of important market-moving economic reports on Monday, traders will look to broader market risk sentiment and US bond yields for potential short-term trading opportunities.