USD/JPY and JPY crosses did little in the European session. Overnight Japanese data saw weaker employment and household consumption, underpinning the weak JPY theme. Production data was on the strong side but a rise in inventories offset the positive headline. Most players chose to sit on the sidelines ahead of a slew of US data due from tomorrow and the FOMC meeting which starts today.
JPY was little affected by further European commentary over the weak yen. It appears that the issue will be brought to the G7, yet it is clearly a European agenda and the wider market has seen limited impact with Japanese officials clearly reluctant to raise the issue. Most of the European action was limited to jobbing the range.
Interbank names bought at the start of the session but momentum waned towards 122.00. Large Asian offers capped and the pair edged back into 121.80. EUR/JPY moved above 158.00, buoyed by a large GBP/JPY buy order. Once the order was filled momentum waned and this seemed to have an adverse effect on the leading JPY pairs. Bias is skewed to a softer JPY tone, yet Asian names look set to cap USD/JPY and EUR/JPY.
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