(Corrects USD/JPY high in fifth line)
• The Takaichi trade is back on with vehemence following the
landslide LDP win
• PM Takaichi's LDP saw a resounding win in Lower House
elections
• The LDP managed to take the majority of electoral
districts
• Opposition left with proportional seats for most part, key
members lost
• USD/JPY 157.95 EBS early Asia following this news, low so
far
today 156.65
• Some caution still over FX intervention from @158.00,
awaiting
word from MOF
• Takaichi win good for Japanese equities, upward pressure
on
rates, weak yen
• USD/JPY holding for most part above 156.47-86 hourly
Ichimoku
cloud
• Ascending 100-HMA 156.50 towards cloud base, 200-HMA
155.13
• Still ascending daily cloud 154.71-156.24, underlining
support?
• JGB-US Treasury rate differentials at short-end of curve
gapped
down Friday
• Differential in 2s to 215 bps, diff in 10s narrower too,
to 194
bps Friday
• In options, large expiries today between 157.00-10, some
155.00-05, 160.00
• On IMM CTA, JPY shorts down again to 19,222 contracts
• Related comments , , ,
• Also
• On Japan elections , , ,
• Trump/Bessent-speak , , on economy
• Bessent on USD , on Fed
• US markets , , ,
• Fed-speak , for more click on [FXBUZ]
USD/JPY:

JGB-US Treasury 2-year interest rate differential:

(Haruya Ida is a Reuters market analyst. The views expressed are
his own)