Yen Outperforms On Yield Pullback, Lower Oil

The yen was the main outperformer in the G10 space for Thursday's session. JPY gained 0.40%, putting USD/JPY back at 150.70/75 in early Friday dealing. We got to 150.25/30 in Thursday NY trade but like earlier in the week, moves sub 150.50 didn't prove sustainable. The US yield dip post softer data outcomes aided the yen, while lower commodity prices, particularly for oil, drove cross yen outperformance.

• US data was mostly weaker than expected Thursday, with initial jobless claims up, while IP growth and NAHB housing sentiment faltered.
• The US 10yr yield pulled back to 4.44%, down nearly 10bps, with similar yield losses across other parts of the curve.
• The slump in oil prices aided yen gains against commodity FX. JPY gained 1% against AUD and ~1.25% against NZD.
• The local data calendar is empty today.
• On the geopolitical front Japan PM Kishida will meet with China President Xi Jinping for the first time in around a year. It was announced later yesterday that the two countries have agreed to establish export control dialogue (per BBG, see this link).
• In terms of option expiries, there isn't much notable nearby to current spot for today's NY cut.