USD/JPY consolidates near YTD high in US upbeat data, Fed’s Powell and BoJ’s Ueda eyed

USD/JPY trades around 144.01, consolidating after reaching a year-to-date high.
The positive US economic data, including Durable Goods Orders and Consumer Confidence, boosted USD/JPY.
Bank of Japan’s ultra-loose monetary policy and dovish comments support USD/JPY upside.
Eyes on Fed Chair Jerome Powell’s upcoming speech at the European Central Bank (ECB) Sintra and Bank of Japan’s Kazuo Ueda panel discussion.

USD/JPY is almost unchanged as the Asian session begins, following a positive Tuesday’s session that witnessed the major reaching a new year-to-date (YTD) high propelled by US economic data and higher US Treasury bond yields. At the time of writing, the USD/JPY exchanges hands at 144.01.

USD/JPY pair eyes further upside as US economic data boosts sentiment and Fed Chair Jerome Powell set to speak

Wall Street closed Tuesday’s session with solid gains, bolstered by upbeat data in the United States (US). The Commerce Department revealed that Durable Good Orders exceeded estimates and April’s data, with numbers increasing by 1.7% YoY, with forecasts of a -1% contraction, and 1.2% in the prior month. Later, the Conference Board (CB) revealed that Consumer Confidence improved to 109.7, crushing estimates of 103.9, above May’s 105 data. The report highlighted an improvement in the labor market, business, and inflation.

At around the same time, US housing data was revealed, with New Home Sales surprisingly jumping at a faster pace over a year, increasing 12.2% MoM in May, above April’s 3.5% data. New home Sales hit the 763K threshold, above April’s 680K.

After the data release, the USD/JPY extended its gains past the 144.00 mark, underpinned by the US 10-year Treasury Note, sitting at 3.772%, advanced four basis points.

Even though Japanese authorities have remained vocal about intervening in the FX market, the market has retraced itself. But recently, dovish comments by the Bank of Japan’s (BoJ) officials aimed to keep their ultra-loose monetary policy stance, alongside an empty Japanese economic docket, suggests further USD/JPY upside is expected.

On Wednesday, the Fed Chair Jerome Powell will speak at the European Central Bank (ECB) Sintra, accompanied by his colleague Kazuo Ueda of the Bank of Japan (BoJ), who will speak at a panel, also joined by the Bank of England (BoE) Governor Andrew Bailey, as well as the European Central Bank (ECB) President Christine Lagarde. Powell and Ueda are expected to keep their current monetary policy stances. However, sudden shifts in their tone could increase the USD/JPY’s volatility around the time of the panel.