FX Action: USD-JPY has been entrenched in a narrow range
FX Action: USD-JPY has been entrenched in a narrow range of less than 20 pips, centred on 110.75, so far in Tokyo trading, where markets have returned after yesterday's holiday. Yen crosses, and most dollar pairings, have been similarly directionally challenged so far. Japan's nationwide core CPI undershot expectations at 0.7% y/y in February. The median forecast had been for 0.8% y/y. The data will maintain pressure on the BoJ to persist with ultra accommodative monetary policy, in the seemingly forlorn endeavour to reach its 2% target. The data cast little impact on the yen, although still undermined bearish arguments for USD-JPY following benign inflation data in the U.S. and the Fed's reaffirmed dovish turn. The 10-year JGB yield hit -0.050%, its lowest since November 2016. In equity markets, the MSCI Asia-Pacific (ex-Japan) index hit a fresh six-and-a-half-year high in early trade before retreating. Most indices in Asia are presently nursing moderate declines. Japan's Nikkei 225 is down 0.3%, while China's CSI 300 is 0.7% for the worse. USD-JPY has resistance at 111.05-07, and support at 110.25-30.