Asia overnight

Investors made a tentatively positive start to what will be a busy week. At the time
of writing, S&P 500 futures were trading modestly in the green and a small majority
of Asian bourses were trading in the red. Investors will be looking to US data this
week, where ironically, any weakening the data could be viewed as good news as
it would take pressure off the Fed to continue hiking rates hard. It would also likely
weaken the USD. The GBP started the week a bit on the back foot as fissures
began developing between UK PM Liz Truss and Chancellor of the Exchequer
Kwasi Kwarteng. Sunday, PM Truss pinned the government’s controversial tax cut
policy on Chancellor Kwarteng. Truss also said that the government was sticking
with its tax plan. G10 FX generally traded in a risk-on fashion with the Antipodean
currencies and the CAD leading the way against a weaker GBP, EUR and JPY.
Soft Japan Tankan data reinforced the view that the BoJ will not be changing tack
on its monetary policy anytime soon and weighed on the JPY. Indeed, USD/JPY
headed higher and through the 145 level, towards levels that previously invited FX
intervention by Japan’s MoF. Japan’s finance minister has already verbally
intervened in the exchange rate today, warning of more actual intervention “if

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