Weakens Early On Oil Price Spike, Tankan Survey On Tap Today

USD/JPY is higher in early trading today. The pair spiked above 133.50 (high of 133.55), but is settling back lower now, last in the 133.20/30 range. This is still around 0.30% weaker versus closing levels in NY from the end of last week (132.86). The 133.50 region also capped USD/JPY gains through Friday's session. The main focus point in early trade today is the weekend news of the OPEC+ oil supply cut. Early moves show WTI and Brent benchmarks +7% firmer.

• Japan terms of trade suffered through the 2022 amid the energy price spike. An offset today could come from heightened risk aversion in the equity space, as the oil price spike weighs on equity sentiment.
• The early impetus to US equity futures is to the downside, helping take USD/JPY off earlier session highs.
• Locally, the main focus today is the Q1 Tankan survey. The large manufacturing index is forecast at 3 from 7 prior. The outlook at 3 from 6. Non-manufacturing is forecast at 20, prior 19, the outlook to 17 from 11. The final March manufacturing PMI is also out today.
• The other focus point is likely to be the tweaks announced to the BoJ's bond buying program, announced at the end of last week (see this link).