AUDJPY Price Eases But No Panic Selling Despite Geopolitical Tensions
AUDJPY price, news and analysis:
- The AUDJPY cross rate, which rises when traders are prepared to buy riskier assets and fall when they are seeking safe havens, is slipping lower – but only gently.
- That suggests traders are still relatively optimistic despite a raft of unfavorable political developments around the world.
AUDJPY slips modestly lower
The AUDJPY exchange rate, seen as the canary in the coalmine that warns of dangers ahead, continues to slip lower but its decline remains gentle despite several adverse events that might have been expected to knock it sharply lower.
AUDJPY Price Chart, Five-Minute Timeframe (February 25-28, 2019)
Chart by IG (You can click on it for a larger image)
Among the recent developments that could have dented confidence more significantly:
- The meeting between US President Donald Trump and North Korean leader Kim Jong-un has ended early without a nuclear deal,
- China’s manufacturing sector contracted for the third straight month in February, hitting a three-year low,
- US Trade Representative Robert Lighthizer has warned that much work is still needed to nail down a US-China trade agreement, including working out how it will be enforced,
- Trump remains under pressure at home from the testimony of his former attorney Michael Cohen, and
- Tensions between India and Pakistan are escalating after the two nuclear powers both shot down each other’s aircraft.
Nonetheless, AUDJPY remains well above the lows touched earlier this month and, for now, traders seem to be holding their nerves as traders decide that a rush into haven assets like the Japanese Yen is not yet called for.
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--- Written by Martin Essex, Analyst and Editor
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.