Foreign exchange markets remain on thrall to the bond market and that remains in a precarious state. US Treasury yields have drifted back off a bit from their recent highs, but 10s remain above 1.70%. High enough not to help global risk sentiment and that, along with more talk of a deeper rate cuts by the BOJ, gave Asian markets a risk-off tone.
USD/JPY has lost momentum, trading in a tight range as the yen is boosted by risk aversion which was itself caused by talk of policy moves to weaken the yen. My bias is to be a USD/JPY bull, and relative real yields are pointing that way.
Australian jobs data recorded a small fall in employment but full-time employment increased by 11,500 after last month’s bigger fall and the unemployment rate fell to 5.6%. We are long AUD/NZD*
This trade is trade and recorded in eFXplus Orders.
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