Europe’s pushback against Trump’s Greenland ambitions hardened overnight, and that was enough to accelerate declines for the US dollar and also send Treasury futures lower.

Financial textbooks would claim that a country with a current account surplus begets a strong currency, but that isn’t working for the yen. Which suggests that investors still need to see additional interest rate hikes from the Bank of Japan, along with direct intervention to support the currency.

USD/JPY is likely to extend gains after it touched a one-year high Friday on a report Prime Minister Sanae Takaichi will call a snap election next month. Given her popularity, and her government’s aggressive fiscal stance, speculation about such a vote will also pressure JGB yields higher, as well as pushing currency traders to watch for any hints of intervention to restrain yen weakness.

Ueda must deliver a hawkish message else JPY risks breaching 160 on Friday post BOJ policy.

AUD further strength needs RBA policy guidance support on Tuesday.

Yesterday's strong 30yr JGB auction implies relief for JPY in the short term.