[MARKET ANALYSIS] JPY gives back gains whilst other G10s are mixed against the USD

DXY trades in a narrow 99.252-99.476 range at the time of writing, and off best levels following yesterday’s hefty decline from a 100.306 high to a 98.975 low, on the back of hawkish-leaning BoJ, BoE and ECB alongside a slide in crude prices. Analysts at ING suggest the “takeaway from this week of central bank decisions hasn’t changed: not enough guidance has been offered to dent oil’s role as a major market driver. Rate expectations should remain fluid and commodity price dependent, and continue to play a secondary role for FX.”
EUR/USD mildly pulled back overnight but trades relatively steady in a narrow range during the European morning. ECB source reports yesterday noted officials see the need for possible rate hike talk to start in April, but added that a move would be more likely in June. Several ECB speakers hit the wires today – most members suggested a meeting-by-meeting approach, whilst ECB’s Nagel said the ECB would need a hike in April if the price outlook sours, and will act with necessary resolve.
GBP/USD trickled lower overnight after strengthening in the aftermath of the BoE decision. GBP clambered off its worst levels during European hours as the USD and oil eased, with GBP/USD finding some support near its 100 DMA (1.3396) while briefly topping its 200 DMA (1.3433) again this morning, trading in a current 1.3398-1.3442 range.
USD/JPY partially rebounds after slumping briefly below the 158.00 handle, while the mild recovery was facilitated by improved risk appetite, but with further momentum contained amid the absence of Japanese participants.
Antipodeans tilt higher amid the positive risk mood, but overall remains in rangebound trade amid the cautiousness heading into the weekend.