Yen Slumps As BoJ Seemingly Plays Down Weak FX Impact On Inflation

Yen losses were strong post the Asia close on Friday. We finished the NY session at 158.33, a yen loss of around 1.7%. The yen was comfortably the worst performing G10 currency for the session, with NOK the next worst at -0.70%. The BBDXY was 0.26% higher for Friday. USD/JPY sits slightly lower in early Monday trade, last around 157.90.

• With the Bank of Japan Governor seemingly playing down the Japanese Yen’s impact on inflation at Friday's policy meeting, investors appear to have been given the green light to bolster their bearish views on the waning currency.
• We did see some yen volatility but dips in the pair were supported back to 155.00.
• In the cross asset space on Friday we saw US Tsy yields finish lower, while equity sentiment was positive across the board, which likely weighed on yen versus the crosses. AUD/JPY sits at 103.15/20 in early dealing today, the pair gained over 4.2% last week.
• For USD/JPY, upside technical projections include 158.97, while note 160.20 was the high in April 1990. On the downside, support to watch lies at 153.56, the 20-day EMA.
• Note onshore markets are closed today.