On the 10th, the Japanese yen traded in the low ¥153 range per dollar. As of 5 p.m., the yen was about 29 sen weaker than the previous day, while its low at 10 a.m. was in the upper ¥153 range. Higher oil prices and rising U.S. interest rates weighed on the currency.
In Tokyo foreign exchange trading on the 10th, the yen traded in the low ¥153 range per dollar. As of 5 p.m., it stood at ¥153.40–42 per dollar and around ¥178.55–59 per euro. In morning trading, the yen fell to ¥153.66–68 per dollar, pushing it into the upper ¥153 range.
The yen-selling was driven in part by rising U.S. long-term interest rates. Expectations that the interest-rate differential between Japan and the United States would widen made dollar buying and yen selling the dominant trend, while higher oil prices also weighed on the yen. There was also speculation that concerns over a deterioration in Japan’s trade balance were prompting importers to sell yen and buy dollars.
In the domestic market, the trading schedule around the 5th and 10th of the month fueled expectations of yen selling and dollar buying by commercial customers. Some market participants also believed that the momentum behind dollar buying had been curbed following coordinated intervention by the Japanese and U.S. governments, and the yen recovered slightly in afternoon trading.
In the oil market, front-month WTI futures briefly rose to $94.78, near a three-month high. EUR/JPY stood at ¥178.74–77 as of 10 a.m. on the 10th, indicating a weaker yen and a stronger euro. With oil prices continuing to rise, concerns over a deterioration in the trade balance were affecting supply and demand for the yen.