USD/JPY and the JPY crosses moved higher in the European morning as funds moved back into the short JPY trade. Activity picked up as the European morning progressed, with players encouraged by the pick in Asian equities. USD/JPY moved through 116.80-117.00 offers and squeezed out shorts through 117.20 to record a 117.25 high.
EUR/JPY traded higher in tandem moving through 154.00 offers to print a 154.19 high. Funds were active via a Japanese name and a UK clearer that were both spotted throughout the European morning. Gains have been hampered to a degree by an overhang of exporter offers and some light selling by lifers reportedly looking to repatriate some of their JPY proceeds ahead of March fiscal year end.
The near-term outlook will be driven by US equity performance and tomorrow's US NFP data. The stabilisation in the global equity market has seen a reduction in risk, which has boosted model fund and hedge fund activity. However, flows have been kept to a minimum ahead tomorrow's US employment data. Today's Fed speakers and the ECB policy announcement and accompanying press conference should also clip gains.
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