Sharp decline in Chinese stocks spur gains in the yen and bonds
USD/JPY is at the lows for the day now around 109.50 as the softer risk mood in markets carry over to the start of European trading.
Chinese equities are the big talking point as they post heavy declines - more than 3% - ahead of the holiday period starting tomorrow. This comes as investors continue to be gripped by fears surrounding the nCoV outbreak, with Wuhan effectively being quarantined.
Bonds are also bid with US 10-year yields down to two-week lows at 1.745% currently.
That said, gold is keeping a little weaker as the trading range between $1,540 and $1,563 continues to limit price action from finding any meaningful direction.
In the currencies space, the dollar is keeping a little more firm but there are individual themes also playing out as we get things going on the session.
The aussie is keeping higher as traders focus more on yields/rates after the Australian jobs report came out stronger-than-expected. That has helped to ease calls for a RBA rate cut on 4 February, helping AUD/USD to climb from 0.6845 to 0.6861 currently.
Meanwhile, the loonie is keeping weaker after a more dovish tilt by the BOC yesterday as the central bank gave some indications of leaning towards rate cuts moving forward.
Looking ahead, we'll have the ECB meeting and Christine Lagarde's press conference later in the session but in the hours ahead it is all about the ebb and flow of things with little else - nothing actually - on the data docket to focus on.