The yen strengthened in New York trading, with dollar-yen in the upper ¥157 range and the euro rising to around the upper ¥176 range. The decline in U.S. stocks and growing expectations of a faster pace of BOJ rate hikes have been cited as factors.
As of 5 p.m. in the New York foreign exchange market, the dollar was quoted in a range of ¥157.62 to ¥157.72. The euro was at $1.1215-$1.1225 and ¥176.80-¥176.90.
The yen was reportedly bought as a safe-haven currency against the backdrop of a sharp decline in U.S. stocks. At the same time, expectations grew that the BOJ would accelerate the pace of rate hikes, prompting further yen buying on expectations of a narrowing U.S.-Japan interest rate differential.
The latest movement is viewed as reflecting exchange-rate levels amid the interplay between falling U.S. stocks and changing expectations for Japanese monetary policy, with investors watching future currency movements and developments in the interest rate differential.
Going forward, trends in U.S. stocks, the BOJ's exit strategy and movements in the interest rate differential could determine the direction of the yen.
Market participants cite U.S. economic indicators and BOJ statements and policy developments as the next important clues.