After the US market decided to leave the federal funds rate unchanged, dollar-yen rose temporarily, but a wait-and-see mood strengthened ahead of the BOJ's monetary policy meeting. Higher oil prices and remarks from the US provided market cues, while euro-dollar movements were also affected.
In the New York market on the 28th, dollar-yen rose to the 158-yen range before falling to around ¥157.77 following the decision to leave the federal funds target range unchanged. Euro-dollar moved to $1.1169 and euro-yen to ¥176.40.
With markets awaiting the outcome of the BOJ monetary policy meeting beginning today, dollar-yen is expected to search for a clear direction, while resistance to further gains at technical points is expected to persist.
The US FOMC confirmed that rates would not be raised, while the statement maintained the wording regarding persistently high inflation. Remarks from Washington were also reported to suggest the possibility of a rate hike at the December meeting, increasing the probability of a December hike.
The BOJ meeting is expected to offer indications regarding the possibility of reaching the 2% price stability target and raising the future outlook, with market expectations that policy will move into a phase of sustaining inflation above 2%.