Listen to the latest market mood for the AUDJPY pair.

Strong AUD, Weak JPY

There was some optimism in the US yesterday as the pace of infections slowed in some key US states and by the Fed’s decision to buy some corporate bonds. This changed yesterday’s risk-off tone and now Asian equity markets are trading higher also on some moderation of the Us-China related headlines with the US to permit Chinese carriers to continue to operate 4 flights from China per week and with the US to allow companies to work with Huawei to develop 5G standards.

• The JPY should remain weaker today as long as this risk on tone remains in the market.
• The high beta AUD should remain stronger on the day.
• Therefore, expect AUDJPY buyers from pullbacks today.We expect this outlook to play out over the next 6-10 hours through to New York close as long as these trading conditions remain.

Main Trade Risks

• One risk is if there is some negative COVID-19 news that will result in the JPY strengthening
• Another key risk is any negative trade news concerning the US and China.