Ella 
The Japanese Yen (JPY) edged lower on Wednesday as investors remained cautious ahead of key US data due later in the day, including the US ADP employment change and ISM services PMI reports. Market attention is expected to turn to the non-farm payrolls report scheduled for Friday.
The yen could face further downward pressure due to the interest rate differential between the US and Japan, which provided support for USD/JPY. However, the upside potential for USD/JPY could be limited by the stronger-than-expected Japanese data released on Wednesday.
The Jibun Bank Japan Services PMI was revised upward to 53.8 in May from 53.6 previously. Despite the upward revision, the index was still below the eight-month high of 54.3 in April, indicating the weakest growth in the services sector since February. In addition, labor cash income rose 2.1% year-on-year in April, beating expectations of 1.7%. It was also the highest since June last year.
The US Dollar Index (DXY), which measures the value of the US dollar against six other major currencies, edged higher due to the improvement in US Treasury yields. However, the weaker US manufacturing PMI in May raised the possibility of the Federal Reserve (Fed) implementing its first interest rate cut in September.
