With the US July CPI release due, USD/JPY is seen as having the potential to break above ¥160. This daily FX report summarises the previous day's moves and recent price levels.
The “Daily FX Report” provided a video update centred on USD/JPY, reviewing the previous day's movements and offering an outlook for the day ahead. The report was written by currency analyst Nakamura Tsutomu (中村 勉) of 外為どっとコム総合研究所.
The latest market information cited developments related to Iran, including reports that the parties were “moving closer to some form of agreement.” USD/JPY rose the previous day before briefly pulling back, but its downside was limited. With the US July CPI release due the following day, the pair saw little aggressive dollar buying and traded narrowly in the low ¥159s.
The US July CPI is the key market event for today, and it has also been reported that USD/JPY could test the ¥160 area again depending on the CPI data. The 100-day moving average is around ¥160.02, and is viewed as a technical milestone warranting attention.
The English summary notes that even if CPI slows, dollar selling is likely to emerge when expectations for additional FRF rate hikes recede, and that the ¥158.50 area could act as support.