Dollar/yen next week is expected to be heavily influenced by the performance of U.S. technology stocks and the October CPI result, with the pair likely to test both its downside and upside levels. Euro/dollar is in a situation where it is prone to move depending on dollar trends.
Next week's outlook is for dollar/yen to be heavily influenced by the performance of U.S. technology stocks and the release of the October U.S. Consumer Price Index (CPI), while developments in investment plans for AI-related data centers will also require attention. If the decline in technology stocks resumes, selling pressure on the dollar and buying pressure on the yen could intensify along with movements in long-term U.S. interest rates.
The projected range for this week is ¥155.00–159.50 for dollar/yen, while euro/dollar is expected to trade within a range of $1.1100–1.1350. Depending on the CPI trend, expectations for a December rate hike could once again be priced in, while oil prices are also likely to be affected by developments in the Middle East.
In a review of the week of 2 November, dollar/yen rose to the ¥158 range before being pushed back to ¥157.41 amid a decline in Japanese stocks, then recovered to the upper ¥158 range in the latter half of the week. However, a sharp drop in technology stocks again intensified downward pressure, sending the pair to ¥157.26. Euro/dollar remained firm from the start of the week and has risen as high as $1.1273.
In the oil market, easing tensions in the Middle East has been discussed against the backdrop of a Democratic Party victory, and lower oil prices could cap dollar/yen's upside. Euro/dollar will depend on the dollar's outlook, but the euro could test higher levels relative to the dollar during periods of falling U.S. interest rates.