USD/JPY jumps toward 145.00 after US data

• US data surpass expectations, focus turns to Friday’s Core PCE. 
• US Treasury yields spike higher pushing USD/JPY further north. 
• The pair has risen in six out of the last seven trading days. 

The USD/JPY pair is moving towards 145.00, trading at its highest level since mid-November. The US Dollar was boosted by positive data, while Treasury bonds experienced a sell-off.

Robust US data keeps coming in

On Thursday, data showed an upward revision to US growth figures in Q1 GDP from 1.3% to 2%. The weekly Jobless Claims report showed Initial Claims dropped more than expected to the lowest level in four weeks at 239K. These figures added to recent evidence of a robust US economy and raised expectations of more rate hikes from the Federal Reserve. On Friday, consumer inflation data is due.

US bonds tumbled following the report. The US 10-yield surged to 3.84%, and the 2-year to 4.88%, the highest since March. The spread between US and Japanese bond is widening further, reflecting growing monetary policy divergence between the Fed and the Bank of Japan.

Approaching 145.00 

The USD/JPY pair printed a fresh monthly high at 144.89 and remains near the top, with strong bullish momentum. The pair is approaching the 145.00 zone, and if the upside continues, rumors about a potential intervention from Japanese authorities may emerge.

A break above 145.00 could trigger volatility and open the doors to further gains. Despite the US Dollar rising in six out of the last seven days versus the Yen, there are no signs of exhaustion. The 144.50 area is the immediate support, followed by daily lows around 144.10 and then 143.75.

Technical levels