With equities down over 2% and US yields a full 10 bp lower on the day (10s now yield 2.92% from 3.20% in the middle of last week), USD/JPY has taken a bruising. Amazing to think we were on the cusp of 81.50 at 8:29 Friday morning ahead of payrolls only to be threatening 80.00 little more than a session later as a G7 economy becomes the focus of the market’s bond vigilantes.
Very good buying has been seen on recent dips toward 80.00. More has been seen in the 70.55/65 zone, protecting what is presumed to be a Chinese-held 79.50 barrier.
We trade now at 80.15. EUR/JPY is at 112.40, the lowest levels since the days after the Japanese earthquake this spring.
