As of noon on the 26th, USD/JPY fell to the upper ¥156 range after buying subsided, due to the impact of falling share prices. The dollar weakened slightly against the yen from the previous day's closing level.
In the Tokyo foreign exchange market on the morning of the 26th, USD/JPY initially rose on buying from genuine-demand accounts, but selling prevailed as the Nikkei Stock Average fell, and by noon the pair had declined to ¥156.72–73 per dollar. Since the previous weekend's closing level was ¥156.95–96, this represented a dollar decline and yen appreciation of approximately 23 sen.
During European hours, the dollar fell temporarily to the ¥156.50 range before rebounding to around ¥157. During US hours, it briefly fell back to around ¥156.30 early in the session, but rose again to around ¥157 in the middle of the session. Toward the end, it was weighed down by selling into the rebound and struggled to recover, remaining at weaker dollar levels.
In early Tokyo trading, the dollar initially strengthened to just below ¥157 before coming under some selling pressure. After 9 a.m., buying by genuine-demand accounts returned, lifting it to around ¥157.20 toward the fixing rate. However, it moved lower toward noon due to the Nikkei's decline and other factors. Market participants said that lower crude oil prices in after-hours trading and falling US long-term interest rates also prompted selling of USD/JPY.
Regarding the outlook, the prevailing view was that it would be difficult for a clear direction to emerge ahead of the event of monetary policy decisions in Japan and the United States. The euro was range-bound against the yen and showed a firming trend against the dollar.