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Japanese Chief Cabinet Secretary Yoshihide Suga said on Thursday, Japan is watching events in Hong Kong (HK) with “great interest”, especially after the civil unrest in the city following China’s passage of the security law for HK.

Japan’s close business ties with Hong Kong were based on Hong Kong’s “one country, two systems” governance, Suga noted.

The tensions over the Hong Kong situation are heightening, as the law punishes crimes of secession, subversion and terrorism with life imprisonment.

Meanwhile, the Australian PM Scott Morrison said earlier today that his country is prepared to ‘step up and support’ Hong Kong citizens.

Separately, on the coronavirus situation in Japan, over 100 news cases are reported in the capital, Tokyo.

Market reaction

Despite positive Asian equities and US stock futures, markets remain cautious amid growing virus cases worldwide and ahead of the all-important US payrolls data.

USD/JPY keeps its range around 107.50 following a bounce from 107.33 while AUD/USD trades flat around 0.6915 amid escalating Australia-China tensions.