The yen is broadly softer today but the US dollar is taking particular advantage in the wake of the strong non-farm payrolls report.
USD/JPY stalled out yesterday just ahead of 140.00 but broke through today as the pair benefits from rising long-term Treasury yields. One of the drivers of higher yields is a warning from Fitch that it will continue to evaluate the US’s AAA rating for a downgrade in Q3. That development certainly wouldn’t be good news for the dollar but for the moment it’s yields in the drivers’ seat.
There are some flows into the US on strong tech stocks but value is also extremely strong today with the Russell 2000 up on less-hawkish Fed hopes. As for the other side of the equation, Japanese GDP is out next Thursday but the focus is going to largely stay on global economic sentiment.