USD/JPY remained in a narrow range from the low to mid-¥159s today, with a strong wait-and-see mood ahead of Chair Warsh's speech. The market is closely watching the content of tonight's speech and geopolitical risk developments involving the United States and Japan.
In today's foreign exchange market, USD/JPY has been moving within a narrow range from the low to mid-¥159s. The market is refraining from actively seeking a directional move, and a strong wait-and-see mood prevails ahead of Chair Warsh's speech.
The market is focusing on the feasibility of implementing US warnings of sanctions related to Iran and developments in US-China relations. In particular, some market participants say that, given reports that China is purchasing large volumes of Iranian crude oil, risk-aversion moves could change depending on the US government's response.
Technically, USD/JPY remains slightly above its 21-day moving average, while the relative positioning of the 100-day and 200-day moving averages is restraining the pair's upside. With concerns about possible intervention limiting attempts to push higher, the focus going forward is expected to be on whether these moving-average levels hold.
The market's focus has shifted to Chair Warsh's speech scheduled for the 28th. Depending on its content, views on dollar debasement and indications regarding the response to inflation could affect the dollar exchange rate, market participants say.
Against this backdrop, no significant movement has been observed so far in New York market options expiries.