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JPY: USD/JPY Supported Sub 140.00, Underperforms USD Index Losses

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USD/JPY tracks near 140.60/65 in early Tuesday dealings. The pair is comfortably off late Asia Pac lows from Monday trade (139.58). Yen gained a modest 0.16% for Monday's session as a whole, slightly lagging broader USD index shifts, the BBDXY fell 0.30%, The DXY off 0.44%.USD indices are very close to late August lows. For USD/JPY, 141.87 is the Sep 13 highs. A break sub Monday intra-session lows could see round figure support at 139.00 targeted. 

  • US TSY yields finished lower across the key benchmarks, albeit with the 2yr yield slight up from intra-session lows (3.52%, before finishing Monday's session at 3.55%). USD/JPY continues to track US yield shifts reasonably closely. Focus remains on the upcoming Fed decision, with expectations relatively steady through Monday, around 41bps in easing priced in for this week's  decision.
  • The general bias around US-JP yield differentials remains skewed lower, albeit more so at the front end.
  • The general resilience of global equity markets helped higher beta plays in the FX space, although US tech stocks finished lower. Yen only outperformed CAD in the G10 FX space, with NZD, AUD and GBP the top performers (up around 0.70%). AUD/JPY last tracks around 95.00, against intra-session lows from Monday at 93.87.
  • The local data calendar has the July tertiary industry index on tap this afternoon, which is unlikely to be a market mover.
  • Note in the option expiry space, there is a 139.75 strike for an option expiry (this Wednesday, in $1.1bn size). 
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USD/JPY tracks near 140.60/65 in early Tuesday dealings. The pair is comfortably off late Asia Pac lows from Monday trade (139.58). Yen gained a modest 0.16% for Monday's session as a whole, slightly lagging broader USD index shifts, the BBDXY fell 0.30%, The DXY off 0.44%.USD indices are very close to late August lows. For USD/JPY, 141.87 is the Sep 13 highs. A break sub Monday intra-session lows could see round figure support at 139.00 targeted. 

  • US TSY yields finished lower across the key benchmarks, albeit with the 2yr yield slight up from intra-session lows (3.52%, before finishing Monday's session at 3.55%). USD/JPY continues to track US yield shifts reasonably closely. Focus remains on the upcoming Fed decision, with expectations relatively steady through Monday, around 41bps in easing priced in for this week's  decision.
  • The general bias around US-JP yield differentials remains skewed lower, albeit more so at the front end.
  • The general resilience of global equity markets helped higher beta plays in the FX space, although US tech stocks finished lower. Yen only outperformed CAD in the G10 FX space, with NZD, AUD and GBP the top performers (up around 0.70%). AUD/JPY last tracks around 95.00, against intra-session lows from Monday at 93.87.
  • The local data calendar has the July tertiary industry index on tap this afternoon, which is unlikely to be a market mover.
  • Note in the option expiry space, there is a 139.75 strike for an option expiry (this Wednesday, in $1.1bn size).