Yen Ignores Wage/Spending Data, BoJ Summary Of Opinions Eyed

USD/JPY lost some altitude Monday as the greenback went offered across the board, with the yen underperforming most of its other G10 peers as the European FX bloc led gains. Participants digested the latest official pushback against suggestions that China might abandon its COVID Zero strategy, which was followed by a WSJ report noting that Chinese leaders are deliberating steps towards re-opening, albeit they are proceeding slowly.

• U.S./Japan yield spreads widened. 2-year spread grew 6.5bp, operating near 22-year highs, while 10-year differential rose 5.5bp. The BoJ's 0.25% cap on 10-Year JGB yields remains under pressure, which turns focus to scheduled 1-10 Year Rinban operations today.
• Equity sentiment was positive on balance, with most major benchmarks advancing. The VIX index was 0.9% lower come the end of play.
• Japanese wage data printed above expected levels, while household spending grew slower than forecast.
• Spot USD/JPY last trades at Y146.70, up 7 pips on the day. Topside technical focus is on Y151.95, the cyclical high printed on Oct 21. Bears look for a fall through the 50-DMA/Oct 27 low located at Y145.28/145.11.
• The BoJ will publish the summary of opinions from its most recent monetary policy meeting shortly. Local data highlights going forward include BoP current account balance & Eco Watchers Survey, due Wednesday.