USD/JPY – neutral bias – (100.80-102.30).
The recent volatility of USD/JPY remains very low. Some geopolitical factors and lower US yields supported JPY buying. However, Japanese importers and investors JPY selling pressure was also steady. The USD/JPY trading range is getting narrower.
USD/JPY volatility is likely to remain dampened until the Fed clearly signals a shift to tighter monetary policy.
Looking ahead, the upcoming FOMC meeting, Q2 2014 GDP and non-farm payroll report are key triggers for dollar buying. A pick up in wage growth and higher US T-bill yields may support USD/JPY buying near the 102-level.
BTMU