AUD/JPY: RBA Lowe’s speech fetches follow-up buying near 88.40

• AUD/JPY has managed to sustain its five-day winning streak.
• RBA’s Lowe seeks more evidence on widespread price pressures before a hawkish response.
• The Japanese yen is going through an intensified sell-off after the BOJ kept interest rates unchanged.

The AUD/JPY pair has rebounded sharply from 88.40 after sensing a decent selling pressure from Tuesday’s high at 88.62. Earlier, the risk barometer continued its five-day winning streak on Tuesday amid the broader sell-off in the Japanese yen.

The cross has witnessed a follow-up buying after a ted hawkish stance in the Reserve Bank of Australia (RBA)’s Governor Philip Lowe. RBA’s Lowe has mentioned that the policymakers are keeping an eye on the labor market for signs of rising costs. However, the central bank has also cleared that it won’t respond unless it will find a significant indication of widespread price pressures. It is worth mentioning that RBA has not followed the footprints of other Western leaders and has kept its interest rates unchanged.

The antipodean has also been underpinned against the Japanese yen on rising metal prices in the global market. While Tokyo is a major importer of metals and is facing the heat of higher metal prices.

The Japanese yen is going through intensified sell-off in the market after the Bank of Japan (BOJ) kept its interest rate unchanged at -0.1%. Japan’s National Consumer Price Index (CPI) accelerated to 0.9% from %, much higher than the previous print of 0.5% and market consensus of 0.3%. The major rationale behind the unchanged stance over the interest rates is the print of National CPI below the upside cap of 2%.

For further direction, investors will focus on Tokyo’s Consumer Price Index (CPI) numbers from the Statistics Bureau of Japan, which are due on Thursday.