Ella 
USD/JPY extended its daily decline, falling below 142.50 at one point, as the downgrade of the US economy sparked cautious sentiment.
The pace of job vacancies in the U.S. has slowed as the ideology of switching careers for quick pay rises is changing.
After providing YCC with more flexibility, the BOJ may seek to eliminate YCC as industry sentiment in Japan is changing.
During the London session, the USD/JPY once fell below the key support level of 142.50. USD/JPY is under intense pressure from a stronger yen as investors look to the Bank of Japan (BoJ) to abandon support for its dovish interest rate policy sooner rather than later.
The U.S. dollar index (DXY) is consolidating in a tight range above key support at 102.00 as investors await U.S. jobs data. The U.S. economy added 189,000 private jobs in July, according to expectations, well below the previously reported 497,000 jobs. The reduction in job creation will send a message that the tightness in the labor market is letting off heat, and the Federal Reserve may consider keeping interest rates steady going forward.
The pace of job vacancies in the U.S. economy has slowed as people now realize that the labor cost index is reverting to the mean and the idea of job hopping for a quick rate hike is changing. Fitch downgraded the credit rating of the U.S. economy from “AAA” to “AA+”, saying that fiscal spending will increase in the next few years and emerging economies will be under pressure, so the overall market sentiment is quite cautious.
Meanwhile, European S&P 500 futures fell sharply amid bearish market sentiment. The yield on the 10-year U.S. Treasury note fell to around 4.02%.
USD/JPY fell sharply amid the greenback’s consolidation, pointing to a stronger yen. Investors believe the Bank of Japan (BoJ) may seek to remove the YCC after providing more flexibility to the yield curve control (YCC), as industry sentiment in Japan is shifting.
