USD/JPY dribbled slowly lower for the session and as I post the wrap has accelerated to the downside. Former Japanese Vice Finance Minister for International Affairs, Takehiko Nakao, who was responsible for instructing Bank of Japan intervention in the yen should he deem it necessary, was reported on news wires a few minutes ago as saying the current weakness in the yen is not beneficial to Japan’s economy. This has prompted the accelerated drop in USD/JPY.

Across other major FX the USD has mainly strengthened. AUD, NZD, GBP all slipped a little during the session. This has meant yen crosses lower.

On the data front today we had a counter point to Nakao’s view. Preliminary PMIs from Japan for June all came in firmly in expansion. Manufacturing was down a little from May but services gained.

Australian flash PMIs also recorded expansion readings.

In China, Shenzen introduced mandatory COVID tests for those wishing to use public transport or attend public venues. The outbreak in Shenzen has been in tiny numbers (so far) but Chinese authorities have nevertheless responded in their rapid fashion.

Oil fell on the session. The private inventory survey showed a build vs. the draw that was expected. Recession fears were a theme playing on commodities (and commodity FX)

usdyen 23 June 2022 wrap