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JPY: USD/JPY Continues To Fall, US-JP Yield Diff Lower, CPI Out Tomorrow

JPY
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USD/JPY has continued to track lower, the pair last near 150.25/30, right on session lows. Yen is up nearly 0.80% versus the USD, with AUD's 0.30% rise the next best performance in the G10 space. 

  • US-JP yield differentials have ticked down, aiding downside USD/JPY. Earlier remarks by BoJ Governor Ueda that he didn't discuss rising yields with PM Ishiba may have helped such trends. It may signal less concern with the trend move higher in JGB yields and therefore comfort with tighter BoJ policy (per BBG).
  • The mostly softer equity market backdrop has also been a yen positive, although crosses like AUD/JPY and NZD/JPY are away from session lows, as broader USD losses unfold.
  • Futures activity hasn't reached earlier highs. Options volumes, per DTCC is over $4.3bn, the largest in the major currency space. Larger volume options have mostly been done at strike lows sub current spot.
  • Note tomorrow, we get Jan National CPI figures.
  • If we break 150.00, note the Dec 9 low at 149.69. 
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USD/JPY has continued to track lower, the pair last near 150.25/30, right on session lows. Yen is up nearly 0.80% versus the USD, with AUD's 0.30% rise the next best performance in the G10 space. 

  • US-JP yield differentials have ticked down, aiding downside USD/JPY. Earlier remarks by BoJ Governor Ueda that he didn't discuss rising yields with PM Ishiba may have helped such trends. It may signal less concern with the trend move higher in JGB yields and therefore comfort with tighter BoJ policy (per BBG).
  • The mostly softer equity market backdrop has also been a yen positive, although crosses like AUD/JPY and NZD/JPY are away from session lows, as broader USD losses unfold.
  • Futures activity hasn't reached earlier highs. Options volumes, per DTCC is over $4.3bn, the largest in the major currency space. Larger volume options have mostly been done at strike lows sub current spot.
  • Note tomorrow, we get Jan National CPI figures.
  • If we break 150.00, note the Dec 9 low at 149.69.