In the Tokyo market, dollar/yen was broadly flat in the ¥157.80 range. The Nikkei 225 extended its decline, weighing on the dollar's upside. However, while falling U.S. long-term yields and crude oil prices provided reasons to sell the dollar, some market participants believe selling will be limited ahead of the U.S. midterm elections.
In the Tokyo market on the afternoon of the 2nd, dollar/yen was little changed in the ¥157.80 range. The Nikkei 225 again extended its decline, creating conditions somewhat conducive to yen buying.
The trading ranges so far were dollar/yen at ¥157.48–¥157.99, euro/yen at ¥175.71–¥176.55 and euro/dollar at $1.1155–$1.1186.
Falling U.S. long-term yields and crude oil prices are likely to encourage dollar selling, although the dollar may also be difficult to sell ahead of tomorrow's U.S. midterm elections.
Following these movements, caution about the market's short-term direction continues to prevail in the foreign exchange market.