Yen Outperforms Broader USD Gains Amid Lower Core Yields, BoJ Jan Mins Out Today

Yen marginally outperformed broader USD gains through Friday trade. USD/JPY pulled back to 151.00 in NY trade before recovering back to 151.40/45 by the close, which is where we track in early Monday Asia Pac trade. Earlier highs were at 151.86 on Friday, just short of Nov 2023 highs at 151.91.

• Yen outperformance reflected a general pull back in core yields through the latter stages of last week, following dovish EU central bank signals. A more mixed equity market backdrop was also evident, so likely weighing on yen crosses at the margin.
• Proximity in USD/JPY to recent cyclical highs may be another factor limiting upside in the pair. Rhetoric around FX levels from the authorities was evident in recent sessions, although didn't appear to be a step up versus previous statements.
• Net shorts in JPY (CFTC data) were -116k as at Tuesday last week (so post the BOJ decision), versus the prior week of -102k.
• Today we have the BoJ minutes from the Jan policy meeting. A number of second tier data releases also print.
• In the FX option expiry space, note we have the following for NY cut later today: Y149.80-00($2.0bln).