Risk is getting some reprieve in early Asia-Pac trade, as the greenback is a tad softer and Antipodean FX trade on the front foot. There has been little in the way of fundamental catalysts behind these moves, major FX crosses still hold rather tight ranges.
- The yen has garnered some strength, which puts it on track to snap a seven-day losing streak vs. the U.S. dollar. Recall that spot USD/JPY pulled back from a new cycle high on Monday, as BoJ Gov Kuroda warned that the "recent rapid depreciation of the yen is undesirable and negative for the economy" while a broader flight to safety shifted focus to the Japanese currency's safe-haven appeal. Weakness in the spot rate was paralleled by a downswing in USD/JPY 1-month risk reversal, which returned below par and lodged its worst levels since May 27.
- Final Japanese industrial output & Australian NAB Business Confidence take focus in Asia, with German ZEW Survey & final CPI, UK jobs data & Swedish CPI due in European hours. Later in the day, U.S. PPI will provide the last insights on inflation dynamics ahead of Wednesday's FOMC meeting.
- The central bank speaker slate features ECB's Schnabel, with Fed members observing their blackout period. The BoK will publish the minutes from its most recent monetary policy meeting.