US GDP And USD/JPY Outlooks May Be Helped By Durables

A 1.3 percent surge in core U.S. durable goods orders in March bodes well for a strong Q1 GDP report Friday and should underpin relatively attractive Treasury yields Japanese investor.

The 37k rebound in jobless claims from the previous week's nearly 50-year low partially offset the durables.

The bigger question is how much of the yen short covering expected to occur before the long Japanese holiday has already occurred.

Those flows have reduced dollar gains against the yen compared to its rise versus other currencies this week.

The breakdown in yen-funded carry trades extended today after a surprise drop in South Korean GDP, tumbling Chinese stocks and yuan, as well as fresh concerns about Germany's banking sector and the European economy.