After the US and Japanese central bank meetings over the weekend, the yen was little changed in the upper ¥157 range. With markets continuing to watch interest-rate trends in Japan and the US, a lack of fresh catalysts is in focus.
In the New York foreign exchange market over the weekend, the yen was little changed, centered around the upper ¥157 range per dollar, and at times strengthened against the previous day, with the dollar weakening. In overseas markets, risk aversion intensified against a backdrop of falling Japanese and US share prices, prompting yen buying and dollar selling.
On the 30th, the Bank of Japan decided to keep its policy rate unchanged at 1.25%. The decision was supported by a majority of members, and its Outlook Report raised the CPI forecast for fiscal 2027 from 2.4% to 2.6%. Although expectations of an additional rate hike in December remain in the market, the pace of tightening was seen as within expectations, limiting the momentum for yen buying.
US economic data did not provide a catalyst strong enough to drive the market decisively in either direction. The Chicago PMI for October fell to 55.3 from 58.8 the previous month, below the market forecast of 56.1, but its impact on the market was limited. Factors supporting a weaker yen and stronger dollar and those supporting a stronger yen and weaker dollar offset each other as markets watched long-term US interest rates.
In the Tokyo market, yen buying pressure intensified amid speculation surrounding the Bank of Japan's policy meeting, sending dollar-yen down from ¥157.89 to ¥157.11. Domestic data showed Tokyo core CPI below market expectations, while the September job-offers-to-applicants ratio exceeded expectations and September retail sales growth fell far short of forecasts.