Outperforms On BoJ Speculation, USD/JPY Comfortably Below 50-day EMA

USD/JPY got just under 146.50 post the NFP print on Friday, fresh lows back to early Feb of this year. We recovered into the close back to 147.00, which is where we track in the first of trade today (147.05/10). Yen was the best performer last week in the G10 space, gaining 2.35%, amid heightened expectations for a BoJ exit from NIRP.

• On Friday, yen strength was driven by concurrent BoJ sources reports from both JiJi News (see this link) and Reuters. Both reports eye the possibility of a March BoJ rate hike should the wage negotiation phase with unions next week continue to show signs of healthy wage growth.
• This, coupled with a generally softer US yield backdrop through last week, aided the sharp pull back in USD/JPY.
• Levels wise for USD/JPY, Friday lows were at 146.49, while 145.90, the Feb 1 is deemed as a key support point. On the topside, 148.52 is the 540-day EMA.
• Today on the data front we have Q4 GDP revisions, which should be aided by the strong Capex rise recovered in the quarter (post the initial estimates). Also out is Feb money stock figures and Feb P machine tool orders.
• In the option expiry space, we only have the following for NY cut later: Y150.00($1.3bln).