Weaker-than-expected Australian GDP growth weighs on the AUD, while Japanese verbal intervention supports the JPY.
The AUD/JPY pair retreated to around 114.45 in early European trading on Wednesday, pressured by softer Australian GDP data. Australia’s economy grew 2.5% year-on-year in Q1, missing the 2.7% forecast, while quarterly growth slowed to 0.3% from 0.8% in the prior period.
Markets now anticipate a more dovish stance from the Reserve Bank of Australia, adding to the Aussie’s decline. Meanwhile, comments from Japan’s Finance Minister Satsuki Katayama signaled readiness for FX intervention, providing support to the yen.
Technical indicators suggest the pair remains bullish, holding above key moving averages, though consolidation is possible near resistance levels.