Japan's government vows to deploy necessary fiscal spending without hesitation in response to the crisis, Reuters reports, citing the government's draft guidelines for the fiscal 2022 budget.

Key takeaways

“Japan must restore economy first and then tackle fiscal reform.”

“Japan must prioritize efforts to shore up the economy over fixing its tattered public finances.”

“The guidelines dropped a reference to the need for "reviewing spending without sanctuary", which had been inserted in recent years as a pledge to stick to fiscal discipline.”

USD/JPY reaction

USD/JPY is treading water around 113.00, on a cautious footing amid falling yields and risk-off trading ahead of the key US NFP release.