Yen Benefits From Renewed Omicron Jitters

USD/JPY traded with a bearish bias on Thursday, with another round of Omicron pessimism dampening broader risk appetite. Participants flocked into safe haven currencies as an early Japanese study showed that the new variant is 4.2 times more transmissible than the Delta variant (note that it was a preliminary study, which has not been peer reviewed or published in an academic journal).

• USD/JPY last sits at Y113.46, little changed on the day. Bears set their sights on Nov 30 low of Y112.53, a key near-term layer of support. Bulls need a clearance of Dec 8/Nov 29 highs of Y113.95/96 before targeting Nov 24 high of Y115.52.
• Unidentified sources told BBG that the BoJ see the lowering of the upper limit on corporate debt purchases as likely, as funding for bid business has improved.
• Japan's PPI figures will hit the wires shortly. Looking further afield, focus will turn to the Tankan Survey & core machine orders (Monday), final industrial output (Tuesday) as well as trade balance & flash Jibun Bank PMIs (Thursday). On Friday, the BoJ will deliver their latest monetary policy decision.