USD/JPY spikes to 110 after stong NFP reading

• Nonfarm Payrolls in US increased 225K in January.
• Annual wage inflation ticked up to 3.1% in US.
• US Dollar Index consolidates daily gains above 98.50 after data.

The USD/JPY spiked to the 110 mark with the initial market reaction to the Nonfarm Payrolls (NFP) report from the US but struggled to preserve its momentum. As of writing, the pair was trading at 109.80, down 0.18% on a daily basis.

USD fails to capitalize on NFP report

The US Bureau of Labor Statistics on Friday announced that NFP rose 225,000 in January to beat the market expectation of 160,000 by a wide margin. Additionally, annual wage inflation, as measured by the Average Hourly Earnings, edged higher to 3.1% to come in slightly higher than the analysts' estimate of 3%.

Despite the upbeat data, the US Dollar Index struggled to gain traction but stays in the positive territory above the 98.50 mark.

In the meantime, the 10-year US Treasury bond yield is down 2.75% on the day and Wall Street's main indexes remain on track to open in the negative territory to reflect a sour market mood, which helps the JPY continue to find demand as a safe-haven.

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