Ella 
AUD/JPY crossed higher for the second straight session on Monday and hit a near two-week high around 94.30-94.35 during the Asian session. Meanwhile, AUD/JPY maintained its intraday gains, showing little reaction to better-than-expected Australian macro data.
Indeed, the Australian Bureau of Statistics (ABS) reported that retail sales, a measure of Australian consumer spending, rose 0.5% in July, compared to expectations for a 0.3% rise and a 0.8% drop the previous month. Weak economic data from China did not provide a significant boost to AUD/JPY, although new stimulus measures from China continued to provide support to ANZ currencies including the Australian dollar (AUD). In addition to this, the downward trend surrounding the Japanese Yen (JPY) is another factor driving the AUD/JPY cross higher.
Notably, China announced on Sunday that it would cut stamp duty on stock transactions in a bid to boost the struggling market and restore investor confidence. Stamp duty on stock transactions will be reduced from 0.1 percent to 0.05 percent from Aug. 28, the finance ministry said in a brief statement, the first reduction in transaction stamp duty since 2008. This in turn sparked a rebound in risk sentiment, coupled with a more dovish stance from the Bank of Japan (BoJ), which was seen weighing on the safe-haven Japanese Yen (JPY) and led to a strong bullish tone for AUD/JPY.
In fact, Bank of Japan Governor Kazuo Ueda, speaking at the Jackson Hole Symposium on Sunday, said Japan’s underlying inflation remains slightly below its 2% target and the central bank will stick to its current ultra-loose monetary policy mechanism. That came after data on Friday showed consumer prices in the Japanese capital Tokyo rose at a slower-than-expected pace in August, largely ensuring that the Bank of Japan is likely to keep policy on hold until next summer. That said, concerns over deteriorating economic conditions may limit AUD/JPY gains.
In addition, the Reserve Bank of Australia will make another decision to keep interest rates unchanged in September, so investors need to be cautious before taking a position on the rise of AUD/JPY. Meanwhile, from a technical standpoint, AUD/JPY’s recent bounce off the 100-day simple moving average (SMA) and subsequent move higher favored the bulls amid major divergences in policy stances taken by the Bank of Japan and other major central banks. Therefore, some follow through to the next relevant level (before the psychological 95.00 level) seems likely.
