Yen Stabilises After Sell-Off, Kuroda Set To Speak

USD/JPY trimmed gains late doors Tuesday amid improvement in risk appetite, as participants weighed the latest comments from Fed members, notably Chair Powell. The top U.S. central banker said that policymakers will address elevated inflation but, unlike several of his colleagues, he refrained from dropping clear suggestions of a more aggressive tightening path. Nonetheless, USD/JPY finished in positive territory, halting its four-day losing streak as a result, while the yen was the only G10 currency to underperform the greenback.

• More than half of respondents in an NHK poll said that they do not expect wages to rise by much, while 14% said they do not expect any gains at all, even as PM Kishida has urged businesses to boost pay by at least 3%. Meanwhile, NHK said that the approval rating of PM Kishida's Cabinet rose 7pp to 57%.
• Japan's BoP current account surplus shrank in November but by less than expected. It stood at Y897.3bn.
• Monthly Eco Watchers Survey and BoJ Gov Kuroda's speech to the branch managers' meeting headline the local docket today.
• USD/JPY changes hands at Y115.33, little changed on the day. Bulls look for a firm push through Jan 4 high of Y116.35, a key near-term resistance level. Bears eye the 20-EMA at Y114.99 for initial support, a break here would expose the 50-EMA at Y114.25.