What’s next? – USDJPY 21.05.18

The dollar was trading 0.48 percent higher vs the Japanese yen at 111.26 as of 06:20 GMT on Monday, with the dollar extending gains on the back of Treasury yields and prospects of a solution for the US-China trade dispute.

The US dollar index, which measures the greenback’s strength against a basket of six major competitors, was up 0.23 percent at 93.76 by the time of this writing.

US Treasury secretary Steven Mnuchin said on Sunday that both nations had made progress following an intense three-day trade negotiations in Washington.

According to Mnuchin, the announced tariffs on $150 billion worth of Chinese goods are off the table as long as trade representatives continue to work on an agreement.

“We’re putting the trade war on hold,” Mnuchin said during a brief interview.

Ahead today, traders will be paying close attention a series of Fed speakers, including FOMC Bostic (16:15 GMT), Harker (18:05 GMT) and Kashkari (21:30 GMT).

Investors also continued to monitor 10-year Treasury yields, which held above the psychological 3 percent mark, adding more pressure to the yellow metal.

“The break in 3.10% overnight and a yield high of 3.122% means that there are few significant hurdles for 10-year treasury bonds sell off further until support at 3.21-3.24%,” Bank of Montreal wrote in a note on Thursday.

No relevant economic data is scheduled ahead in the session. Overnight, Japan’s trade balance came in at 626 billion yen, well above a forecasted 406 billion reading. Exports were up 7.8 percent, falling short from an estimated 8.1 percent growth.

FortFS