AUD/JPY rises above 90.50 following disappointing Japan's export data

• AUD/JPY edges higher as the Japanese Yen retreats following weaker-than-expected export figures from Japan for March.
• Japan's exports rose 3.9% year-over-year, missing the 4.5% forecast and sharply down from February's 11.4% surge.
• The Australian Dollar remains under pressure after Thursday's release of mixed domestic employment data.

AUD/JPY recovers its recent losses registered in the previous session, trading near 90.70 during Thursday's European session. The recovery is largely driven by weakness in the Japanese Yen (JPY), following disappointing export data from Japan for March. Export growth rose just 3.9% year-over-year to JPY 9,847.8 billion, falling short of the expected 4.5% increase. This marks a significant slowdown from the 11.4% surge in February, which had been bolstered by US steel and aluminum tariffs. However, a rebound in imports suggests domestic demand remains relatively resilient.

Adding to the narrative, Japan's Economy Minister Ryosei Akazawa stated that foreign exchange issues were not part of the ongoing trade talks in Washington. Japan is pressing for a full removal of the Trump-era tariffs, including a 10% base tariff and an additional 25% levy on car exports. Akazawa indicated that Japan is seeking a mutually beneficial agreement as soon as possible, while also noting the US appears keen to strike a deal within the current 90-day negotiation window.

Despite the JPY's softness, gains in the AUD/JPY pair may be limited due to headwinds facing by the Australian Dollar (AUD). Australia's latest employment report showed the Unemployment Rate rose to 4.1% in March, just under the forecasted 4.2%. Meanwhile, Employment Change came in at 32.2K, missing the expected 40K figure.

The AUD found some support from improving global risk sentiment, after US President Donald Trump announced exemptions for key technology products from the proposed "reciprocal" tariffs. These exemptions--covering smartphones, computers, semiconductors, solar cells, and flat-panel displays--primarily benefit goods made in China, Australia's largest trading partner and also a major buyer of its commodities. However, Trump simultaneously launched a probe into potential tariffs on critical minerals, further escalating trade tensions with China.