InvestingLive Asia-Pacific FX news wrap: Japanese shares biggest drop in four months

Forex Short News

Oil futures opened the week with a gap down after OPEC+ confirmed over the weekend it would raise output by 548,000 barrels per day in September—an increase that was broadly expected. The initial weakness in oil prices gradually faded over the session as the gap was steadily filled.

USD/JPY was active, rising from just above 147.00 to test highs just below 148.00. Japan’s chief trade negotiator, Ryosei Akazawa, downplayed the recently announced US-Japan trade agreement, stating it is not a legally binding commitment and cautioning against taking all US commentary on the deal at face value. His remarks cast doubt on the enforceability and substance of the agreement.

Japanese government bond yields declined, raising concerns about demand ahead of Tuesday’s 10-year JGB auction. Equities in Japan posted a sharp drop, with the Nikkei logging its steepest fall in four months. Elsewhere in the region, Asia-Pacific equities traded mixed.

In currency markets, broader G10 FX ranges were limited, with the US dollar regaining some stability following Friday’s sharp losses.

News flow was light. From Australia, a private inflation gauge from the Melbourne Institute showed a sharp reacceleration in July, with both headline and core measures rising at their fastest pace in 19 months.

Geopolitical developments also featured, with President Trump confirming that his special envoy Steve Witkoff will travel to Russia next week. The visit comes ahead of a fresh round of US sanctions and amid rising tensions with Moscow. Meanwhile, Trump and Canadian Prime Minister Mark Carney are expected to speak in the coming days as trade and tariff frictions continue to simmer.

This article was written by Eamonn Sheridan at investinglive.com.