JPY: Asia Wrap - Kato Remarks Test Overnight Lows
May-20 04:20
The Asia-Pac range has been 144.73 - 145.51, Asia is currently trading around 144.80. Early demand for USD’s going into the Japanese Fix was met by fresh selling reacting to comments from the Japanese Finance minister Kato, this saw a quick move to revisit the overnight lows where some demand again returned.
- "*KATO: ARRANGING BESSENT MEETING TO DISCUSS TOPICS INCLUDING FX, TALKS W BESSENT ON FX WILL SEEK TO FOLLOW EXISTING STANCE" - BBG
- Akazawa made comments this morning reiterating his commitment to seek a removal of “All US Tariffs”.
- Very poor demand seen in the 20-year JGB auction today, tail the longest since 1987.
- Nippon Steel pledged to invest more in US Steel — including building a new mill and preserving jobs — if the US approves their merger, people familiar said.(BBG)
- USD/JPY continues to test its support and the price action is interesting considering the bounce in stocks.
- The support around 144/145 looks important now and a break would once again bring the focus back to the pivotal 140.00 area. The price action though does not look great and the market is still more comfortable selling rallies.
Options : Closest significant option expiries for NY cut, based on DTCC data: 145.50($1.03b May 20), 145.00($789.7m May 20) , Upcoming Strikes : 145.00($2b May 23),144.00($1.37b May 23), 140.00(1.67b May 23)
Fig 1 : USD/JPY Spot Daily Chart
Source: MNI - Market News/Bloomberg
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| Date | Time | Country | Event |
| 25-Apr | 0745 | FR | Manufacturing Sentiment |
| 29-Apr | 0700 | DE | GFK Consumer Climate |
| 29-Apr | 0800 | ES | HICP (p) / GDP |
| 29-Apr | 0900 | EU | M3 / Consumer Expectations Survey |
| 29-Apr | 0900 | IT | ISTAT Confidence Indices |
| 29-Apr | 1000 | EU | Consumer Confidence, Industrial Sentiment |
| 30-Apr | 0630 | FR | GDP (p) / Consumer Spending |
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| 30-Apr | 0855 | DE | Unemployment |
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| 30-Apr | 0900 | IT | GDP (p) |
| 30-Apr | 1000 | EU | GDP preliminary flash est. |
| 30-Apr | 1000 | IT | HICP (p) |
| 30-Apr | 1100 | IT | PPI |
| 30-Apr | 1300 | DE | HICP (p) |
JGBS: Twist-Steepener Holds Going Into W/E, BoJ Gov Ueda Reiterates Caution
Apr-18 05:16
JGB futures are stronger, +18 compared to settlement levels, sitting near the middle of the range after a choppy session.
- “Governor Kazuo Ueda reiterates his stance that the central bank will carefully monitor if its economic outlook will be realized, accounting for the effects of US tariff measures, without preconception. The BoJ will raise the benchmark rate if the outlook is realized, Ueda says in response to questions in parliament.” (per BBG)
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- Cash JGBs have twist-steepened, pivoting at the 20-year, with yields 2bps lower to 5bps higher.
- Swap rates are 2bps lower to 2bps higher, with a steepening bias.
- On Monday, the local calendar will see Tokyo Condominiums for Sale data.
