Yen Extends Friday's Losses Into New Week After BoJ Sticks With Powerful Easing

Spot USD/JPY is building on last Friday's gains, moving past the Y148.00 mark as we type. The rate last operates +47 pips at Y148.07, with the yen lagging its G10 peers. The key bullish technical target is Y151.95, the high print of Oct 21. Bears look for a pullback towards Oct 27 low of Y145.11.

• U.S./Japan yield differentials widen further in morning Tokyo trade, with 2-Year gap last +2.4bp and 10-year spread +1.2bp. 10-Year JGB yield sits at 0.246%, after easing below the BoJ's 0.25% ceiling last Friday.
• Reminder that the central bank kept its ultra-loose monetary policy settings unchanged (see our review here) and boosted the frequency of bond purchases last Friday. Governor Kuroda said he does not expect a rate hike or policy exit anytime soon, adding that monetary policy does not target FX markets.
• Leveraged funds trimmed net JPY short positions by 5,601 contracts to 33,835 in the week through Oct 25, according to the latest CFTC report. Asset managers booster net yen shorts by 5,213 contracts to 79.668.
• Japan's industrial output shrank 1.6% M/M in September, preliminary data showed, which was a deeper sequential contraction than expected by economists in a Bloomberg survey (median est. -0.8%). Retail sales rose 1.1% M/M, topping the +0.8% consensus forecast.
• Consumer confidence and housing starts data will cross the wires later today, but are unlikely to move the needle on the yen.