In Tokyo morning trading on the 10th, dollar-yen held above ¥158, with buying returning after a temporary decline early in the session. Expectations for an additional BOJ rate hike capped gains, and, together with firm equities, the market continued to trade in a narrow range around ¥158.
In Tokyo morning trading on the 10th, dollar-yen edged higher, moving from around ¥157.84 to around ¥158.11 before continuing to trade in the lower ¥158 range. Dollar buying prevailed ahead of the Tokyo fixing, and the pair at one point climbed to ¥158.12.
Euro-yen strengthened in the upper ¥177 range, rising to ¥177.42 before retreating to around ¥177.30. Euro-dollar remained confined to a narrow range of $1.1216–$1.1224.
In the opinions published by the Bank of Japan from its monetary policy meeting, the view that the next rate hike should be implemented in a timely manner rather than rushed coexisted with the view that underlying inflation would settle at 2%, leaving opinions divided over the timing of a rate hike. The policy rate was left unchanged.
In the equity market, the Nikkei 225 recovered the ¥60,000 level and expanded its gain to more than ¥1,800 from the previous day. Against a backdrop of strong market conditions, buying of euros and selling of yen progressed, sending euro-yen gradually higher. Although dollar-yen held above ¥158, expectations for an additional rate hike continued to support the yen, and the prevailing view was that trading would remain range-bound around ¥158 for the time being.