Japan wage negotiations take center stage.

Reports coming through from Japan will be front and center until the wage negotiation meeting conclusion on Friday. It currently appears record wage increase are on the cards, which will be JPY positive and put pressure on the BOJ to change policy. Unfortunately, it may be prudent to leave the Yen alone until after next week's interest rate meeting. As any headlines could move the JPY in either direction until then.

In other news, the reluctance of the USD to sustain strength following yesterday's CPI data suggests to me that the market is waiting for the right moment to resume USD shorts. but with no significant data released today, it could be up to tomorrow's retail sales to inject volatility (with the potential for a pre release 'anticipation grid trade')

The GBP today reported solid GDP data (in keeping with the run of good data, bad data) Citi bank have moved forward their prediction for a UK rate cut from August to June. But all in all I would suggest the UK will still be cutting later than most of the other central banks due to still having the highest inflation.

Currently, it's very difficult to have confidence in the direction of any of the currencies. And barring an out of the blue catalyst, it could be a case of waiting for Tomorrow's US data for a fresh opportunity.

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