AUD/JPY Jumps Near 94.50 as Trump Talks About Big Tariffs on Japan
The AUD/JPY pair moved up close to 94.50 in early Asian trading after news that former US President Donald Trump is thinking about putting 30%–35% tariffs on goods from Japan. He might also choose not to extend the current trade deadline set for July 9. This news made the Japanese Yen weaker and pushed the Aussie higher.
At the same time, the Bank of Japan is still being very cautious. One of its new board members said any interest rate hikes should be slow. The Bank’s Governor also mentioned that inflation is still uneven across the country. This makes it less likely the Yen will get support from higher interest rates anytime soon.
Meanwhile, Australia’s latest economic data was mixed. Retail sales in May only went up by 0.2%, which was lower than expected. Also, building permits didn’t rise much. Still, traders are keeping an eye on upcoming reports from China and more local Australian data, which could affect the Aussie Dollar.
So far, AUD/JPY is rising mainly because of weakness in the Yen and worries about trade. But how long it stays high depends on how strong the Australian economy looks in the coming days.
Impact:
AUD/JPY might rise further if trade tensions with Japan increase. But weak Australian data could slow down or reverse the upward move.