Yen To Fresh 2024 Lows Post Uchida Speech

Yen was comfortably the worst performer in the G10 space through Thursday's session. We lost around 0.75%, with USD/JPY tracking in the 149.30/35 region in early trade today. Highs in the pair, from Thursday trade, came just under 149.50. Carry over from Deputy Governor Uchida's speech and press conference yesterday was a clear yen headwind.

• To recap, the policymaker acknowledged the likely need for tighter policy in Japan in the near-term, but played down the prospect of a more protracted tightening cycle after a first theoretical rate hike. He stated that it is hard to see Japan requiring a sharp hiking pace after rate lift-off.
• For USD/JPY focus is now on 149.75, the Nov 22 high. Key short-term support is unchanged at 145.90, the Feb 1 low. The focus may also rest on whether official rhetoric picks up around FX weakness, particularly if we threaten 150.00.
• A higher US yield tilt added to USD/JPY momentum, the US-JP 10yr spread is back near +345bps, not too far off 2024 highs. Fed rhetoric was similar from Barkin to recent comments, the central bank has time to wait re cuts. IJCs data was close to expected.
• The local data calendar just has Jan money stock data, which is unlikely to shift market sentiment.
• In the option expiry space, note the following for NY expiry later today: Y147.50($1.4bln), Y148.50-65($2.1bln), Y149.00($647mln).
• On the wages front, BBG notes that firms are boosting pay for young workers (see this link for more details).