USD/JPY Back Above 158.00, After Fresh Lows On Friday Amid Intervention Speculation

USD/JPY sits close to 158.15 in latest dealings. Earlier highs were at 158.25. We are around 0.20% weaker in yen terms versus end Friday levels. Like elsewhere, the yen is modestly weaker in today, as the USD has received some support as Trump's election odds have risen post the weekend assassination attempt.

• For USD/JPY, intra-session lows on Friday printed at 157.38, which was just under Thursday lows, which came amid intervention fears post the soft US CPI print. There was also intervention speculation on Friday, see this link for more details.
• BBG estimates put Thursday's intervention at $22bn (see this link).
• US-JP yield differentials remain skewed lower, the 10yr cash government bond yield differential back to +320bps, levels last seen in May last year. The 2yr spread is around +442bps.
• US data was mixed on Friday, firmer PPI, but softer consumer sentiment. US yields remained softer though, with markets nearly fully priced for a September rate cut.
• US Tsy futures have opened softer in the first part of Monday dealing, likely reflecting Trump's firmer election odds.
• Note onshore markets are closed in Japan today. For USD/JPY we are close to the 50-day EMA (just under 158.00), while intra-session lows from Friday at 157.38 could be another downside focus point. Early Friday highs rest at 159.45.
• In the option expiry space, note the following for NY cut later today: Y157.75($585mln), Y158.00($966mln), Y160.50($1.4bln).