USD/JPY retreats sharply after US manufacturing data

USD/JPY dropped sharply after the release of the PMI and the ISM index in the US. The pair erased all gains and from testing 104.00 dropped toward 103.00 in a few minutes.

Yen recovers

The yen strengthened and trimmed losses across the board as stock in Wall Street dropped further into negative territory. USD/JPY rose to the highest level in a month at 103.99 and then turned to the downside. Recently it reached 103.11, level located slightly above 103.05 (Asian session lows).

At the moment the pair is trading at 103.25/30, around the same level it closed yesterday. The sharp reversal today was triggered by weak US data. The ISM manufacturing come in at 49.4, back into contraction territory and posting the lowest level since January. Markit manufacturing PMI also missed expectations as it came at 52.0 against the 52.1 expected.