JPY: USD/JPY Up From Multi Month Lows, As Front End US Yields Rise on CPI

USD/JPY rebounded post the Asia close on Wednesday, the pair getting back above 142.50 not long after the firmer than expected US core CPI printed. The pair was still volatile, pulling back sub 141.50 before ending the US session near 142.30/35, which is where we currently track in early Thursday trade. Yen was close to unchanged for Wednesday's session, while broader USD indices were mixed, DXY up 0.10%, but BBDXY down by around this amount. 

• US front end yields ended Wednesday trade higher, the 2yr up nearly 5bps to 3.64%. Market Fed easing expectations were pared. U.S. core CPI surprised higher in August on a housing inflation rebound, rising 0.281% last month against expectations for a 0.2% increase.  
• This should help stabilize US-JP yield differentials, particularly at the short end, although we are only a touch above recent lows, levels last seen back in August 2022.
• Elsewhere, we had a better US equity tone into the US close on Wednesday, the SPX up 1.07%, the Nasdaq nearly +2.20%. This likely helped USD/JPY firm through US trade, although only AUD and CAD outperformed yen in the G10 space.
• Technical wise for USD/JPY, 140.25, the Dec 28 low from last year remains key support (yesterday's low was at 140.71) and resistance is not seen until 143.71, the Sep 9 high.
• Locally today we have the Q3 BSI sentiment survey, along with the Aug PPI. Weekly foreign investment flows are also due, as is more BoJ speak (10am local time).