With the short-end of the US yield curve anticipating rates hikes as early as September, short-term rates have backed up in breathtaking fashion today. 2-year notes are 36 bp higher in yield, an astounding move in a maturity that short.
A move that large has awakened USD/JPY, sending the pair through downtrend resistance at 98.25 and as high as 98.88 so far. Rumors of 99.00 barriers are making the rounds. Bulls will now target the 99.55/75 area where prices topped out in early May. 98.25 is a good level to establish longs if Asia books profits early Monday.
