USD/JPY Can't Test Friday Lows, Focus On Upcoming USD/CNY Fix

Outside of some earlier yen gains it has been a relatively muted start to G10 trading so far in Monday trade. The BBDXY last tracked near 1246.60, closed to unchanged from end NY levels on Friday.

• In the cross asset space, US equity futures sit a touch higher, while US yields are down a touch, the 10yr last near 4.19%, continuing the theme of a softer core yield backdrop.
• USD/JPY got to lows of 151.09 in earlier trade, as currency chief Kanda spoke in Tokyo. Kanda's comments appeared a step up in FX rhetoric, noting speculative moves have been driving yen and that the authorities are prepared to take action.
• Still, USD/JPY lows from Friday around 151.00 have held and we sit back at 151.35/40 in recent dealings. BoJ minutes from the Jan meeting have also been released. They note the risks of not moving soon in terms of rates could mean more aggressive action later on. They noted that easy conditions, along with bond buying, would be maintained if exit from NIRP was delivered.
• AUD and NZD are close to unchanged at the time of writing. AUD/USD last at 0.6510/15, while NZD/USD is in the 0.5990/95 region.
• Focus is likely to rest on the upcoming USD/CNY fix. Friday's move above 7.1000 help undermine CNY and this spilled over into broader USD gains as onshore USD/CNY spot broke above 7.2000.
• We do have some Japan data later on but it is second tier.