Dollar Flat, Yen Remains in Focus
The US dollar index remained virtually flat at the close of trading on Tuesday (Aug 4), hovering around 99.89. The dollar has struggled to find a clear direction, weighed down by yen intervention and uncertainty regarding Federal Reserve interest rate moves. The euro strengthened to around US$1.1524, while the pound sterling rose to US$1.3452.
Market attention remains fixed on the yen following coordinated intervention by the United States and Japan. The USD/JPY pair traded around 157.45—up slightly from the previous session but still well below the 163.99 level recorded in July. The yen had previously strengthened to 155.20 per US dollar, its best level in three months.
This move marked the first joint intervention since 2011 and the first yen purchase by the US since 1998. Washington's involvement reinforced the message that the US and Japan do not want yen weakness to disrupt bond markets, trade, or economic stability in Asia. However, the impact could be limited unless supported by a Bank of Japan rate hike or a narrowing of the yield spread with the US.
On the economic front, US JOLTS job openings fell to 7.359 million in June. The figure indicates that labor demand is beginning to cool, although hiring remained around 5.3 million and the layoff rate showed no spike. The data was not weak enough to alter the view that the US labor market remains relatively stable.
The dollar was also held back by a drop in oil prices after the US, Qatar, Oman, and Iran showed progress in talks to reopen the Strait of Hormuz. Lower oil prices could ease inflation risks and reduce the likelihood of a Fed rate hike; however, the absence of a final agreement means geopolitical risks continue to limit the dollar's decline.
Newsmaker Analysis: The DXY remains poised for consolidation ahead of the Non-Farm Payrolls (NFP) report. The 100.00–100.10 range serves as the immediate resistance, while 99.70–99.50 acts as support. For USD/JPY, a rise above 158.00 could pave the way for a move toward 160.00 but also heighten the risk of further intervention. Conversely, a drop below 155.20 could strengthen the yen's momentum. Strong NFP data tends to boost the dollar, whereas weak results could once again weigh on the DXY and support the yen and gold. (arl)
Source: Newsmaker.id
