FX Action: USD-JPY has posted less than a 20 pip range
FX Action: USD-JPY has posted less than a 20 pip range so far in Tokyo trading, defined by 111.13 and 111.31, which continues a phase of tight consolidative price action for a fourth consecutive session. The pair remains near the midway mark of a broadly sideways, sometimes choppy range that's been unfolding for some two months now, during which time both the Dollar and Yen have tended to directionally correlate in their respective performances against other currencies. Relevant news for USD-JPY has remain thin today. BoJ member Suzuki said there is a need to pay attention to the impact of loose monetary policy on the JGB market, though to little market impact. Stock market sentiment in Asia has been lacklustre, with Chinese indexes down while Japan, South Korea and others showing only modest gains. News, broken by Canada's Globe and Mail, that Canada is prepared to make a significant concession on dairy to secure a NAFTA deal, failed to inspire, although the Canadian Dollar rallied. Yield differentials remains a fundamental bullish driver for USD-JPY, but the risks being posed by U.S.-driven trade protectionism has been capping upside potential in recent months, which analysts expect to remain the case, despite the evident progress with Mexico and Canada. Resistance comes in at 112.15, and support at 110.93-95.