At the start of the New York session, USD/JPY fell back to the 157 yen level after failing to hold above its 200-day moving average. Lower US Treasury yields after the holiday and expectations that the BOJ will defer a rate hike are weighing on the pair.
The dollar was broadly sold in today's foreign exchange market, and USD/JPY was pressured by selling into rallies. Although it briefly rose above the previous day's high, it failed to hold above its 200-day moving average and fell again to the 157 yen level.
Reports that the BOJ is likely to leave its policy rate unchanged at its meeting at the end of this month limited the yen's temporary weakening. The market appears to believe that the risk of a sharp acceleration in inflation has not increased.
However, reports also indicate that another rate hike at the next meeting in December cannot be ruled out. The BOJ is reportedly considering advancing its assessment of underlying inflation to "around 2%."
No options expiry at the 23:00 local-time New York cut has been observed near current levels.