Yen at 8-Week High

The yen rallied following U.S. President Donald Trump's overnight warning to North Korea that any threat would be met with "fire and fury." Trump was reacting to a Washington Post report that said the “rogue” communist regime had successfully developed a miniaturized nuclear warhead that could fit inside missiles.

Following Trump's warning, North Korea responded early Wednesday by saying it was contemplating launching a missile strike against the U.S. Pacific territory of Guam.

USDJPY plunged below the key psychological level of 110.00000 in Wednesday morning trade. The pair rebounded amidst a bout of profit-booking to last trade around 110.0500. 110.20000 represents the immediate upside resistance, from where a fresh wave of selling could emerge.

Depending on how North Korea reacts, USDJPY could be headed lower.

A widely-followed gauge of small-business confidence in the United States rose in July, buoyed by stronger hiring and an improved economic outlook.

The National Federation of Independent Business’ Index of Small Business Optimism rose to 105.2 last month from 103.6 in June. The pick-up was the index's first since January, and easily topped the consensus forecast for a decline to 103.2.

Small business owners signaled optimism in their ability to expand their operations largely due to an uptick in consumer spending. It follows robust official jobs data released on Friday.

However, the survey showed business owners had little enthusiasm for increasing their capital expenditures, as they wait for greater policy clarity from Washington.

Dow Jones Industrial Average September futures were last trading around 22020.