Dollar Holding Close To Friday Highs, China Feb Activity Figures Out Later

The USD is slightly higher in the first part of Monday dealing, overall moves are muted at this stage. The BBDXY tracks near 1236, which is close to Friday highs from last week. Follow through has been limited though above the 1236 level.

• US yields were modestly higher in the first part of trade, but gains in this space have had no follow through at this stage. The 10yr yield isn't too far off YTD highs.
• USD/JPY is holding above 149.00, with dips sub this supported so far. Friday highs at 149.17 haven't been breached yet. Jan core machine orders were slightly weaker than expected, but FX sentiment wasn't impacted.
• The sense is growing for a policy shift/exiting NIRP at tomorrow's BoJ policy announcement, but equally scope for potentially continued bond purchases (to curb yield gains) and a tightening cycle that is unlikely to be aggressive, is curbing yen enthusiasm.
• The higher US yield backdrop through the latter stages of last week was also a clear yen headwind.
• AUD/USD and NZD/USD sit down a touch but only modestly. AUD/USD was last near 0.6560, NZD/USD at 0.6085.
• Coming up in a little while is China activity data for Feb.