The yen fell to the low ¥154 range against the dollar in the New York market on the morning of the 10th. U.S. PPI exceeded market expectations and long-term yields rose, strengthening dollar buying. Heightened tensions in the Middle East and higher oil prices also contributed to yen weakness.
In the New York foreign exchange market on the morning of the 10th, the yen fell to the low ¥154 range against the dollar. The wholesale price index for August, released by the U.S. Department of Labor, exceeded market expectations, strengthening yen selling and dollar buying as U.S. long-term yields rose. As of 9 a.m., the dollar was trading at ¥154.30–154.40, compared with ¥153.48–153.58 at 5 p.m. the previous day, representing a yen decline of about ¥0.82 against the dollar.
U.S. PPI rose 5.4% year on year, exceeding the market forecast of 5.3% and indicating persistent inflationary pressure. Against this backdrop, U.S. long-term yields rose, intensifying yen selling and dollar buying. In addition, heightened tensions in the Middle East pushed U.S. crude oil prices above $100 in morning trading for the first time in about 3 and a half months, providing another factor supporting dollar buying.
Expectations that the Bank of Japan will accelerate the pace of interest-rate increases provided support for the yen, which resisted further declines in the low ¥154 range. In the Tokyo market, hawkish comments from BOJ officials strengthened yen-buying pressure, and dollar-yen moved into the low ¥153 range.
In the New York market, the euro traded at $1.1600–1.1610 against the dollar and ¥179.00–179.10 against the yen, moving toward a weaker yen and stronger euro from the previous day. The tug-of-war between the BOJ’s monetary policy management and U.S. inflation trends is expected to continue, while developments in the Middle East could affect oil prices and, in turn, the currency market.