• AUD/JPY picks up bids from multi-day low but challenges to sentiment weigh on the quote.
  • Australia’s largest state by population lifts mask mandate, restrictions on social gatherings as well as eye 100% stadium capacity.
  • BOJ minutes, Japan data couldn’t entertain traders amid falling US Treasury yields.
  • Risk catalysts remain as the key driver, US bonds will be in the spotlight.

AUD/JPY sellers catch a breather around 82.62, down 0.14% intraday, amid early Wednesday. In doing so, the quote respects the recent coronavirus (COVID-19) activity announcement from Australia’s New South Wales (NSW). However, risk-off mood tests the recovery moves.

NSW announces substantial removal of the virus-led activity restrictions from Monday. Among many, turning down the masks and favoring 100% stadium capacity are the key to watch. The news helps the Australian dollar (AUD) as the Oz nation becomes the first to lift covid restriction after the UK.

On the other hand, Bank of Japan (BOJ) minutes and Japan’s upbeat Corporate Service Price Index and Jibun Bank Services PMI, respectively for February and March, failed to entertain the Japanese yen (JPY) buyers. The reason for the same could be traced from the US Treasury’s downbeat performance, currently declining three basis points (bps) to 1.60%.

Despite the upbeat announcements, the fears of a flood in the NSW and virus resurgence-led lockdown extensions in Europe join West versus China tussles to weigh on the risks. Even so, Australia’s ASX 200 rises 0.5% by the press time amid optimism at home.

Moving on, AUD/JPY traders will keep their eyes on the risk headlines for fresh impulse amid a light calendar.

Technical analysis

Sustained break of an ascending trend line from November 01, 2020 keeps AUD/JPY bears hopeful.

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