Yen Firms, But With Little Follow Through, Tight Ranges Elsewhere

USD indices are lower, largely in part to a firmer yen through the afternoon session. The BBDXY is back to the 1221.50 region, which is -0.06% sub NY closing levels from Friday. The JPY is the +0.20% higher at this stage, while other pairs are more subdued. AUD/USD is the weakest performer, down close 0.15% to 0.7090.

• Yen has had a volatile session, getting close to 130.30 before comments from a potential future Deputy Governor (Yuri Okina) sparked a yen rebound. We got close to 129.20 before support emerged, the pair last at 129.60/65. Okina stated that there needs to be a rethink of BoJ and government cooperation, as she outlined her preference for the Bank’s inflation target to be shifted to a longer-term goal.
• AUD/USD was firmer early doors, but ran out of steam around the 0.7120 level. Not much follow through to the China equity rebound at the open, may have seen some profit taking flows emerge. In the commodity space, copper slipped to $421.25 (CMX basis), but iron ore firmed to $128.25/ton, +1.50%.
• NZD/USD couldn't sustain moves above 0.6500, last around 0.6495/00, close to flat for the session.
• Looking ahead, the calendar remains quiet in the northern hemisphere later with the highlight the EC survey for January and only the Dallas Fed manufacturing index in the US.