USD/JPY clings to small gains above 110 after US CPI data
- Annual core CPI in US stayed unchanged at 2.3% in December.
- US Dollar Index posts modest daily gains above 97.50.
- Wall Street looks to open flat on Tuesday.
The USD/JPY pair started the week on strong footing and rose above the 110 handle for the first time since mid-May as the upbeat market mood caused the safe-haven JPY to lose demand. Although the pair edged higher earlier in the day on Tuesday, it seems to be waiting for the next catalyst. As of writing, the pair was up 0.12% on the day at 110.06.
The US Department of Treasury's decision to remove China from its list of currency manipulators before the US and China sign the phase-one deal in Washington on Wednesday provided a boost to the market sentiment. Now, investors are waiting to see the details of the phase-one deal, which are expected to be released ahead of the signing ceremony.
US Dollar Index stays in range after CPI data
The data published by the US Bureau of Labor Statistics (BLS) on Tuesday showed that the core Consumer Price Index (CPI) stayed unchanged at 2.3% on a yearly basis in December to match the market expectation despite ticking down to 0.1% on a monthly basis. The US Dollar Index largely ignored the data and was last seen adding 0.15% on the day at 97.52.
In the meantime, Wall Street's main indexes look to start the day flat as investors seem to be opting out to stay on the sidelines ahead of key earnings figures. Reflecting the neutral mood, the 10-year US Treasury bond yield is registering small daily losses.
Technical levels to watch for