• Middle East conflict remains the main focus in FX, other markets

• No end in sight yet, crude oil higher, stagflation concerns

• USD/JPY in stasis on 159, Asia 159.63-72 EBS, quiet so far

• Upside capped by threat of Japan FX intervention, especially 160+

• Downside limited, bids from Japanese importers, others on dips

• Good support pre-159.00, today sees $807 mln option expiries at strike

• Some at 158.00, 160.00-05 $737 mln, 160.25 $650 mln, 160.50 $761 mln

• JGB-US Treasury rate differentials well below recent wides

• Differential in 2s last @246 bps, in 10s @193 bps, to narrow more?

• Related comments , , also

• US markets , , ,

• On Iran war , Fed , US economy

• Also , on BOJ , for more click on [FXBUZ]

USD/JPY:


JGB-US Treasury 10-year interest rate differential:

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