Yen Pressured After BOJ Meeting

Yen is the weakest performer in the G-10 space at the margins on Friday after the latest BoJ Monetary Policy decision. The BoJ removed reference to Covid in its forward guidance. It also removed reference to rates in terms of the guidance (expecting rates to remain at low or present levels was left out), but the Bank left in that is prepared to take further easing measures if necessary. The BOJ will also conduct a review, which is expected to take 1 to 1.5 yrs.

• USD/JPY prints at ¥134.65/75, the pair is ~0.5% firmer, gains have been marginally pared after printing a post BOJ high at ¥134.94. Bulls target the high from Apr 19 at ¥135.13, break through here opens ¥135.96 76.4% retracement of the Mar 8-24 bear leg.
• AUD/USD is ~0.2% as spillover from the USD/JPY has helped the USD firm, support is seen at $0.6591 low Apr 26. Westpac noted that it expects the RBA to pause again at its May meeting and that 3.6% is the likely cash rate peak.
• Kiwi is a touch softer, however a narrow $0.6140/60 range has prevailed thus far today.
• Elsewhere in G-10, GBP and EUR are both ~0.1% softer.
• Cross asset wise; e-minis are ~0.1% softer and BBDXY is ~0.2% firmer. US Treasury Yields are ~1bp lower across the curve.
• In Europe today we have Eurozone, French and German GDP and Regional and National German CPI. Further out we have a slew of US data including PCE Deflator, MNI Chicago PMI and UofMich Consumer Sentiment.