US Retail Sales are due later in the NA session. Market consensus expects headline sales to have expanded at a monthly 0.6% during September, leaving behind August’s 0.3% contraction. Prior estimates for sales stripping the Autos sector point to a monthly gain of 0.4%, up from the previous 0.1% drop.
Regarding FX, the upside in the greenback has been the sole driver behind the pair’s ascent beyond the critical barrier at 104.00 the figure, levels last traded in late July. Positive results today would surely give further oxygen to the ongoing USD rally, allowing USD/JPY to extend the upside further north. In this regard, it is worth noting that there are no relevant hurdles between current levels and July’s peak in the mid-107.00s.
The persistent selling bias around the Japanese safe haven has been reinforced by the radio silence from the BoJ as of late. However, skepticism among investors regarding the ability of the central bank to spur inflation in the country remains high, and carries the potential to limit further gains.