Published at 11:14 (GMT) 04 Nov

USDJPY

JPY has been pulled down by the combination of official statements tending to lean toward talking the currency down and pushed up by the FX markets reaction to the equity market decline that was suppose to represent a reduction in the overall market's risk appetite. In truth, the equity market decline probably prompted a good deal of position squaring in advance of the week's heavy calendar of events. In today's trading, equities are up, JPY is vulnerable. Adding to the pressure on JPY outright and on the crosses is more jawboning by the BoJ and Fin Min representatives that is not JPY supportive. Finally, in actual trading, with the Japanese back from holiday, dealers are pushing prices higher, setting off stops at 0.9080 and making a run at 0.9100s. Also from a flows perspective, there is talk of Japanese pension funds on the bid in USD/JPY. Finally, anecdotal reports of good buying interest in JPY options into next year, but most interesting are the bets being placed for Fri, with 91.00 calls in good demand. M.B.