Forex Flash: USD/JPY in focus following parliamentary hearing – UBS

In Japan, the two BoJ Deputy Governor nominees faced a parliamentary hearing – Nominee Kikuo Iwata called for "regime change" at the BoJ along with more radical easing, and said he would not be bound by precedent when conducting policy going forward. Meanwhile, the USD/JPY slipped however when a single DPJ (opposition) lawmaker said he would not support Iwata's confirmation because of Iwata's desire to see BoJ law changed. It is not yet clear if the rest of the DPJ harbor similar concerns. No date has yet been set for the confirmation vote, though March 14 or 15 seem likely.

Meanwhile in the US, according to Research Analyst Gareth Berry at UBS, “The non-manufacturing ISM print today could shed some light on the 'surprise' direction for Friday's payrolls print. Our economists are already looking for a robust print of +190k, mostly led by the retail sector. A firm employment sub-index with today's release would confirm this view, and perhaps remind markets that despite the better 'relative' performance in the Eurozone economy of late, the stronger 'absolute' economy of the US (fiscal woes notwithstanding) continue to support the case for growth-divergence in favour of US assets on a structural basis.”