USD/JPY: The pair finished the session lower

EUR/USD

The pair finished the session higher, supported by broad based AUD weakness which inspired a sharp rally by EUR/AUD and also generally weaker USD which fell over 0.3%. In terms of Eurozone specific macroeconomic commentary, ECB's Weidmann said that buying government bonds risks blurring line between monetary and fiscal policy. He also added that low interest rates can give impulse to the economy and that he sees German economic upswing continuing this year and next.
At the same time, ECB's Coeure said that there is no binding limit to where main interest rate can go; ECB may not add long-term loans as growth recovers.

GBP/USD

In spite of a weaker USD and AUD weakness inspired gains for GBP/AUD following the release of the latest jobs report from Australia, the pair settled little changed as broad based EUR strength saw EUR/GBP trend higher and in turn offset any potential gains for the pair. There was little in terms of UK specific macroeconomic commentary, but RICS global director King said that unless we see a marked increase in the number of homes coming up for sale we could well be looking at price rises becoming unsustainable in some areas.

USD/JPY

The pair finished the session lower, amid unfavourable interest rate differential flows as USTs remained supported by corporate hedging related flow and also somewhat weaker weekly US jobs report. This in turn sent USTs higher, amid touted buying by real money and also CTA accounts.
There was also unconfirmed market talk of a NY think-tank report on Bank of Japan policy saying they expect no change in monetary policy next week due to inflation sitting at a five-year high. The report also said to say that the central bank is keen to differentiate the slower buying of JGBs from a taper, with the amount to increase as needed.

AUD/USD

AUD fell sharply across the board overnight during the Asian session following the release of the latest jobs report which showed that the country suffered its lowest annual jobs growth in 17 years. At the same time, the report revealed that the participation rate fell to 64.6% in December, the lowest level since 2006. The broad based selling pressure in turn buoyed EUR and GBP related crosses, both climbing back above their respective 21DMA levels.