FX Markets: Aussie Dollar Breaks 0.7100, Yen Rallies on Political Shifts

High-beta currencies and safe havens are diverging sharply against the Greenback as traders position themselves for upcoming US labor data. The Australian Dollar (AUD) has emerged as a standout performer, breaking key technical resistance, while the Japanese Yen (JPY) is attracting significant inflows.

AUD/USD Hits Multi-Year Peaks

The AUD/USD pair successfully cleared the 0.7100 psychological barrier during Wednesday's Asian session, marking a fresh high since February 2023. The rally is underpinned by a technical breakout following a brief consolidation, with bulls targeting further upside as the US Dollar weakens ahead of the NFP report.

Yen Strength Returns

Simultaneously, the Japanese Yen is staging a broad recovery. The AUD/JPY cross, despite Aussie strength, has faced headwinds near 109.15, while GBP/JPY has plunged to two-month lows around the mid-209.00s.

Market analysis attributes the Yen's resurgence to fresh foreign capital inflows into Japanese equities following Prime Minister Sanae Takaichi's election victory. The political stability has renewed demand for the JPY as a store of value. Meanwhile, the USD/CHF pair has also slipped to near 0.7650.

Key Market Data & Technicals

• Breakout: AUD/USD cleared 0.7100, reaching highest levels since February 2023.
• Resistance: AUD/JPY slowing near 109.15.
• Support Levels: GBP/JPY at 209.00s; USD/CHF near 0.7650.