Yen under the spotlight, what's going on? - Scotiabank

Analysts at Scotiabank explained that JPY was entering the NA session nearly flat vs. the USD on Tuesday following an impressive recovery from early Asian session weakness driven by the release of weaker than expected PPI.

Key Quotes:

"Sentiment remains dominant as we continue to highlight JPY’s remarkable divergence from levels implied by spreads."

"Risk reversals hint to a continued build in the premium for protection against JPY strength across a range of time horizons."

"EUR/JPY is also showing signs of renewed weakness and appears vulnerable following its failure to fully retrace last week’s decline."