US DATA: Challenger Job Trends This Year Are Higher-Firing, Lower-Hiring

• A combination of drivers have propelled USDJPY to a fresh one month high of 148.93 on Tuesday. On the topside, 149.12 is the next resistance (61.8% of the Aug 1 - 14 bear leg). However, should momentum continue to gather speed, investors will look to another retracement level at 149.81, followed by 150.92, the August 01 high and a key resistance.
• The initial impetus for the squeeze higher came from BOJ Deputy Governor Himino, who gave no guidance on the timing or pace of potential rate hikes, providing little confidence to yen longs.
• The dynamic of widening yield differentials underpinning the USDJPY rally was then exacerbated by a relief rally for JGB futures following a very solid 10-year auction (highest bid-to-cover since 2023) and the subsequent contrasting pressure on core fixed income that has seen US 10-year yields extend their rise to 7bp on the day.
• Political uncertainty also played its part in the yen sell-off, as a flurry of resignations from senior leadership positions within the governing LDP have followed an internal party meeting. It remains to be seen whether this proves a sufficient sacrifice to keep Japanese PM Ishiba in office.

EU trade sources comment on the probability of approval for a trade deal with Mercosur. -- On MNI Policy MainWire now, for more details please contact sales@marketnews.com

• +6,800 UXYZ5 113-23, buy through 113-22.5 post time offer at 0836:13ET, DV01 $590,000.
• The 10Y Ultra contract trades 113-23.5 last (-21.5)