AUD/JPY struggling with 84.00 level as Japan data misses, risk aversion shows signs of life

• Downturn in Japan data sees the Yen bid up slightly, but risk appetite is winning the day so far on positive Aussie figures.
• RBA statement still due in Asia trading could hamper bidding if rhetoric is adjusted too much.

The AUD/JPY bumped higher in early Asia trading, clipping into a new weekly high of 84.18 before some Japanese economic figures missed expectations, temporarily reversing cash flows and propping up the Yen once more, leaving the pair to trade back where it ended Monday's rally session, just beneath the 84.00 major handle.

Overall Household Spending for April contracted by -1.3% versus the 0.8% forecast, and Japan's Markit Services PMI also swung lower to 51.0, a worse-than-expected contraction from the expected 51.9, compared to the previous reading of 52.5. Economic data for Japan is continuing to push out disappointing figures, and the Bank of Japan's (BoJ) goals of stoking inflationary pressures continues to butt up against turgid barriers in an aging population that refuses to overspend.

On the Aussie side, the AiG Performance of Services Index clipped higher to 59.0 versus the previous 55.2, and the AUD is looking to resume being bid up after markets flipped into risk-on mode on Monday, regardless of ongoing geopolitical tensions and trade difficulties. Tuesday isn't quite finished with the Aussie yet though, with the Reserve Bank of Australia delivering their latest rate statement at 04:30 GMT today.

AUD/JPY levels to watch

The pair is looking for some continued lift ahead of the RBA rate statement, fiddling with the 84.00 handle. A continued break over the day's high near 84.20 will see a continued push into 84.50, while a sudden reversal could see the pair slumping back to the week's opening prices near 82.75 if market sentiment decides to take a turn for the bearish.