USD/JPY flows: Rebound in PPI

While all eyes remain on BoJ's interest rate decision later this week, we have stronger than expected PPI, which would be supportive for the BoJ's interest rate decision to hike. The Japan May PPI came in at +0.7% m/m, beating estimate and rose from 0.3% in April and +2.4% y/y with expectation of +2.0%. Despite the fact PPI's translation into CPI has been gradual and limited, it would add fuel to the wage driven inflation in the coming months. U.S. Treasury Yields are performing individually and 10yr JGB yields had dipped below 1%.

USD/JPY is trading 0.03% higher at 157.18.