Yen buying and dollar selling dominated the London morning session, with USD/JPY falling into the upper 155 range. The euro and pound moved only slightly, while cross-yen pairs tilted toward yen strength.
Yen buying and dollar selling dominated the London morning session, as the dollar-buying trend following hawkish expectations after the previous day's US FOMC meeting underwent a correction. Softer crude oil prices were also cited as one factor, while USD/JPY was said to be affected by position adjustments ahead of the Bank of Japan meeting.
USD/JPY broke below its Tokyo morning low and, after touching 155.88 in the early London session, fell to 155.53. It rebounded into the 155.80 range, but then declined again to the 155.50 range. EUR/USD was pushed down to around 1.1456 around midday in Tokyo, then reached a high of 1.1484 in the early London session before falling back into the 1.1460 range and eventually settling in the 1.1470 range. GBP/USD showed a similar pattern, rising from a low of around 1.3369 to around 1.3402 before settling in the 1.3370 range.
The move toward yen strength was attributed to the size of the decline in USD/JPY, with the possibility of position adjustments ahead of the Bank of Japan's policy meeting, reflecting expectations of an interest-rate hike, also cited. Among cross-yen pairs, EUR/JPY fell from a high of around 179.23 to around 178.48, while GBP/JPY fell from around 209.18 to around 208.24. Current rates were USD/JPY 155.73, EUR/USD 1.1473, GBP/USD 1.3394, EUR/JPY 178.71 and GBP/JPY 208.60.