The yen is backed by jittery tones seen in the equities space
The big story so far ahead of European trading has been the break higher in Treasury yields. 10-year yields have climbed above the 3.20% for the first time since 2011 and that has set off some nervous tones in global equities to start the day.
And in the currencies market the focus has been on the slightly more risk off tones seen in equities with the yen taking charge as a result, with USD/JPY also held back by key resistance levels. The dollar and swissie are holding firm with the euro and pound a little weaker ahead of European trading.
But the two currencies being beaten down are the aussie and kiwi as yields spread divergence and the negative risk sentiment weighs on both commodity currencies. With the Chinese offshore yuan weakening further as well due to dollar strength - from higher yields - it's not providing any relief for the aussie and kiwi really.
If you're looking for trades in the sessions ahead, keep an eye out on yields. That is going to be the ultimate driver of sentiment in both risk and the dollar ahead of the US jobs report tomorrow.
