12.05.2020 Usd/Jpy Daily Analysis

12.05.2020 Usd/Jpy Daily Analysis

Usd/Jpy is trading at 107.54, it fell down with 0.12 mainly because Japanese Finance Minister Taro Aso said on Tuesday he was not considering tax cuts, including a reduction in the sales tax, for the time being as a way of easing the economic pain from the coronavirus pandemic and this made the yen to gain strength against the dollar. The US dollar is lower mainly because of fears about the second wave of coronavirus infections. As countries around the world gradually ease restrictions in an effort to restart their economies, investors are becoming anxious about the second wave of infections. The central Chinese city of Wuhan, where the pandemic originated, reported five new cases on Monday, its first new cases since its lockdown was lifted, while South Korea, the Asian poster child on how to deal with the virus, has had to combat a new spike in cases. Meanwhile, Federal Reserve officials talked down the prospect of negative rates - St. Louis Fed President James Bullard said on Monday that negative rates stateside would be “problematic.” His counterparts from Atlanta and Chicago, Raphael Bostic, and Charles Evans were similarly dismissive. Fed speakers are scheduled to talk late today - Philadelphia's Patrick Harker and Cleveland's Loretta Mester - and they are likely to weigh in on the issue.