AUD/JPY moves in an upward direction to near 98.00 after dovish remarks from BoJ Ueda

• AUD/JPY extends its winning streak after dovish comments from BoJ Governor Kazuo Ueda.
• BoJ Governor Ueda expects monetary conditions in Japan to remain accommodative.
• The higher S&P/ASX 200 index helped the Australian Dollar to hold ground.

AUD/JPY continues its winning streak for the third successive day, extending higher to near 98.00 during the European session on Friday. The dovish Friday’s remarks from the Bank of Japan (BoJ) Governor Kazuo Ueda weigh on the Japanese Yen (JPY) and, consequently, act as a tailwind for the AUD/JPY cross. He stated that monetary conditions in Japan are expected to remain accommodative in relevance to the current economic and price outlook.

On Thursday, the downbeat Gross Domestic Product (GDP) data confirmed that Japan’s economy has entered into a technical recession. This cements the speculation that the Bank of Japan (BoJ) may postpone exiting its negative interest rate policy, pushing investors to move away from the safe-haven Japanese Yen.

The Australian Dollar (AUD) received upward support from the S&P/ASX 200 index’s improvement tracking the overnight surge in Wall Street. The Australian economy has shown modest growth, influenced by ongoing challenges in the labor market and subdued inflationary pressures.

Moreover, the latest Aussie employment data could prevent the Reserve Bank of Australia (RBA) from pursuing further interest rate hikes in the upcoming March meeting. However, Market sentiment indicates that the RBA will likely hold its current interest rates until August and may initiate a loosening policy with 25 basis points (bps) in September.