Yen Outperforms On BoJ Bond Buying Speculation & Lower US Yields

USD/JPY tracked lower post the Asia close on Tuesday. The pair got close to 154.50 by the NY session before recovering modestly. We track near 154.85 in early Wednesday dealings, after posting a near 0.80% gain in yen terms for Tuesday's session.

• We pierced the 50-day EMA (154.65) in Tuesday US trade but couldn't sustain this break. Note as well trend line support sits at 153.81 (drawn from the Dec 28 low).
• Yen rallied initially on headlines that the BoJ will consider curbing its bond buying at next week's policy meeting (see this BBG link). Further support came on weaker US JOLTS job opening data. US yields finished lower across the benchmarks, with the 10yr yield off just over 6bps to sub 4.33%. US-JP yield differentials maintained their recent downward trajectory.
• Yen and the Swiss Franc were the only currencies to record gains against the USD for Tuesday's session, significantly outperforming the rest of the G10.
• On the local data front today we have April cash earnings on tap. The headline measures are expected to rebound (nominal earnings to 1.8% y/y from 1.0% prior, real earnings to -0.9%y/y, from -2.1% prior). Same sample base figures are expected to hold steady just above 2% y/y. Also out is PMI revisions for May on the services side.
• In the option expiry space, note the following for NY cut later: 153.00-10($1.3bln), Y154.60-75($815mln), Y155.30($885mln), Y156.60-65($739mln).