The Japanese Yen (JPY) is soft, entering Monday’s NA session with a modest decline against the US Dollar (USD), Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret note.

Yield spreads are narrowing in a JPY-supportive manner

"Domestic developments have been limited and all eyes are on the preliminary PMI’s and CPI data scheduled for release later this week. We also expect to hear from BoJ Gov. Ueda at the upcoming Jackson Hole symposium but note the absence of a publicly scheduled appearance. The outlook for relative central bank policy remains supportive as markets look to a renewed hawkishness from the BoJ."

"Yield spreads are narrowing in a JPY-supportive manner and threatening fresh lows. For USD/JPY, we look to a bearish break of the recent range, targeting a near-term push below the 50 day MA (146.53)."