Risk-Off prevails, JPY enters its fourth day of gains

Risk off mode prevails as traders continued to support the JPY against the USD. USDJPY is in its fourth consecutive day of gains as it tests the 50 DMA (101.85) earlier this morning.

Concerns with regards to Deutsche Bank’s fine continued to drag sentiment lower and in the meatime, Military strikes between India and Pakistan kept risk levels high as the possibility of an escalation loomed.

US major equity inidces closed in the red yesterday at close. Asia was mostly lower as well this morning.

Euro remains close to flat against the USD as the EURUSD currently trades at 1.1218 after an earlier open at 1.1221. We’re expecting declines to remain supported at 1.1195/1.1170, price action may tentatively attempt a re-test of 1.1275 unless there is a break of 1.1143 to the downside.

Japan’s inflation data, released earlier in today’s session, continued to show a declining CPI with actual figures declining both at the headline level and the core (ex-food and energy) level. Showing that declines in inflation continued to prevail and exposed doubts on the BoJ’s ability to avert this trend.

In today’s economic docket we shall se the latest EZ CPI estimates for September, Canadian GDP for July and we have the University of Michigan consumer sentiment from the US later this afternoon.

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