USD/JPY bulls stand their ground as US equities close higher

• USD/JPY held ground despite weakness in the US dollar and firmer risk appetite. 
• The Fed chair failed to deliver anything new in his WSJ interview and risk appetite recovered on Wall Street. 

At 129.34, USD/JPY is higher by some 0.18% into the close on Wall Street. Risk rallied on Tuesday as April industrial production and retail sales grew more than expected, indicating the strength of the economy which to some extent helped the US dollar vs the safe-haven yen.

As a consequence of the good mood, the S&P 500 and the Dow advanced 2.0% and 1.3%, respectively, while the tech-heavy Nasdaq jumped 2.8%. However, besides the yen, the dollar fell for a third straight day on Tuesday vs.s a basket of currencies. The greenback was pulling back from a two-decade high against a basket of major peers, as an uptick in investors' appetite for riskier bets diminished the US currency's appeal. The US 10-year yield jumped by 10.5 basis points to 2.98%. 

The U.S. Dollar Currency Index (DXY), which tracks the greenback against six major currencies, was down 0.84% at 103.226, its lowest since May 6. The index hit a two-decade high last week supported by a hawkish Federal Reserve and worries over the global economic situation.

Fed Chair Jerome Powell, speaking at a Wall Street Journal event, vowed to "keep pushing" until it was clear the current inflationary wave is on the wane but this failed to keep risk down for long and equities rallied into the close for fresh highs. 

As for data, Retail Sales and industrial output data provided a dose of optimism for market participants who fear the expected series of 50-basis-point interest rate hikes could drag the economy into recession.

Additionally,  reports that authorities in China are preparing to relax COVID-19 restrictions allayed worries over the risks to supply chains and weakening Chinese demand that would be expected to continue weighing on the global outlook.