Yen Falls Amid Risk-on Mood

(RTTNews) - The Japanese yen weakened against other major currencies in the Asian session on Wednesday, as Asian stock markets traded higher on optimism about amicable trade deals being reached between the U.S. and its trade partners over the weekend after the recent uncertainty. Major currencies in the region also strengthened against the US dollar.

A report showing an unexpected increase by job openings in the U.S. in the month of April portrayed a healthy U.S. labor market despite increased risks from trade policy.

Traders continued to await further developments on the trade front a month ahead of the expiration of US President Donald Trump's 90-day tariff pause.

The Bank of Japan (BoJ) Governor Kazuo Ueda made cautious remarks on Tuesday, fueling expectations that the next interest rate hike may not occur soon. Calls for the Bank of Japan to slow tapering beyond 2026, along with a generally bullish risk tone, appear to be important elements eroding the safe-haven JPY.

In economic news, data from the S&P Global survey results showed that growth in Japan's service-sector activity slowed less than expected in May. The final au Jibun Bank Services Purchasing Managers' Index (PMI) was revised to 51.0 from 50.8 in the flash data. This was lower than the previous month's final figure of 52.4, but it represented a second straight increase in services activity.

In the Asian trading today, the yen fell to 6-day lows of 164.08 against the euro and 195.01 against the pound, from yesterday's closing quotes of 163.73 and 194.60, respectively. If the yen extends its downtrend, it is likely to find support around 166.00 against the euro and 197.00 against the pound.

The yen slipped to a 5-day low of 144.27 against the U.S. dollar, from Tuesday's closing value of 143.82. On the downside, 148.00 is seen as the next support level for the yen.

Against the Swiss franc and the NZ dollar, the yen edged down to 175.02 and 86.52 from yesterday's closing quotes of 174.75 and 86.37, respectively. The yen may test support near 177.00 against the franc and 88.00 against the kiwi.

Against the Australia and the Canadian dollars, the yen slipped to 6-day lows of 93.17 and 105.15 from Tuesday's closing quotes of 92.97 and 104.87, respectively. The next support level for the yen is seen around 95.00 against the aussie and 106.00 against the loonie.

Looking ahead, S&P Global composite and services PMI results for May are due to be released in the European session.

In the New York session, U.S and Canada PMI data for May, U.S. MBA mortgage approvals data, U.S. ADP private-sector employment for May, Canada labor productivity data for the first quarter, U.S. EIA crude oil data and U.S. Fed Beige Book report are slated for release.