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USD/JPY Back Above 157.00 On US Yield Bounce, BoJ Speak Today

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USD/JPY recovered ground as the US session unfolded on Tuesday. From sub 156.60 we got to 157.20 by the end of the session and sit just below this level in early Wednesday dealings. The yen lost just under 0.20% for Tuesday's session, the worst performer in the G10 space.

  • Broader USD sentiment firmed through the US session, the BBDXY index pushed back above 1249. Stronger-than-expected US consumer confidence provided the greenback with a temporary boost before receiving a second wind from higher US Treasury yields after tails at two- and five-year auctions in a holiday-shortened week.
  • US yields finished 3-9.5bps firmer across the benchmarks. This provided some stability/upside to US-JP yield differentials, offsetting the continued push higher in JGB yields.
  • For USD/JPY a fresh break above the 157.20 level could see the May 1 high at 157.99 targeted. The 20-day EMA is back near 155.80 on the downside.
  • On the data front today we have consumer confidence for May out later. Before this BoJ Board member Adachi speaks in Kumamoto at 11:30am local time.
  • In the option expiry space note the following for NY cut later today: Y154.70-75($1.3bln), Y156.20-30($743mln), Y156.50($629mln), Y157.90-10($1.6bln).
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USD/JPY recovered ground as the US session unfolded on Tuesday. From sub 156.60 we got to 157.20 by the end of the session and sit just below this level in early Wednesday dealings. The yen lost just under 0.20% for Tuesday's session, the worst performer in the G10 space.

  • Broader USD sentiment firmed through the US session, the BBDXY index pushed back above 1249. Stronger-than-expected US consumer confidence provided the greenback with a temporary boost before receiving a second wind from higher US Treasury yields after tails at two- and five-year auctions in a holiday-shortened week.
  • US yields finished 3-9.5bps firmer across the benchmarks. This provided some stability/upside to US-JP yield differentials, offsetting the continued push higher in JGB yields.
  • For USD/JPY a fresh break above the 157.20 level could see the May 1 high at 157.99 targeted. The 20-day EMA is back near 155.80 on the downside.
  • On the data front today we have consumer confidence for May out later. Before this BoJ Board member Adachi speaks in Kumamoto at 11:30am local time.
  • In the option expiry space note the following for NY cut later today: Y154.70-75($1.3bln), Y156.20-30($743mln), Y156.50($629mln), Y157.90-10($1.6bln).