Japan Considers Extending Virus Measures, Might Hold Olympics Without Spectators

USD/JPY see-sawed Tuesday, but finished on the back foot eventually, extending its losing streak to four days in a row. The pair was heavy as broader risk sentiment soured, amid concerns over the spread of the Delta variant.

• The BoJ shifted to quarterly from monthly bond-buying plans, while trimming purchases for the next quarter across 1-3, 5-10 & 10-25 Year buckets. The idea of switching to quarterly plans was raised by bond market participants during their regular meeting with BoJ officials.
• Jiji reported that Japan will suspend parts of the Olympic Torch relay between Jul 9 - 16. Elsewhere, Mainichi suggested that Japan might extend virus measures in Tokyo by 2 - 4 weeks and could hold the Games without spectators if curbs remain in place after Jul 11.
• BBG reported that PM Suga's move to lower mobile phone fees may result in Y430bn in savings on phone charges this year, also noting that smaller telecommunication fees shaved 0.5pp off the latest CPI print.
• Preliminary industrial output data, housing starts & consumer confidence are due out of Japan today. On Thursday, focus moves to the latest Tankan survey & final Jibun Bank M'fing PMI.
• USD/JPY last seen at Y110.51, barely changed on the day. Below Jun 22 low of Y110.21 would open up Jun 21 low of Y109.72. On the flip side, gains past Jun 24 high of Y111.12 would put bulls into the driving seat.