The dollar/yen rate rose to just below ¥158 in the early hours of the 28th, as the market continued looking for clues on the next rate hike in the US FOMC statement and the chair's remarks. The outlook takes into account the impact of the US indicators released on the 27th and the market's reaction.
On Tuesday the 27th, the yen weakened and dollar buying prevailed against the backdrop of higher share prices in the Tokyo market, with dollar/yen rising to around ¥157.98. As developments concerning wages and prices continue to be monitored, the market is increasingly waiting for the FOMC. Against this backdrop, future interest rate trends have become the market's focus.
Among US economic indicators, September durable goods orders rose 1.8% month on month, below the forecast of 1.9%, while core capital goods excluding durable goods rose 0.5%, below the market forecast of 0.7%. The CB noted that the consumer confidence index improved sharply in October, while indicating that it remains on a downward trend over the longer term.
Meanwhile, the US October consumer confidence index came in at 91.7, well above the forecast of 81.0, while new home sales released at the same time reached an annualized 676,000, above the market forecast of 651,000. Although these data suggest resilience in the economy, whether further rate hikes will be possible will again become the market's focus depending on the FOMC statement and the chair's remarks at the press conference.
The FOMC policy rate announcement is scheduled for today during New York hours, and whether rate hikes could resume will be a key market concern. Most market participants have priced in the policy rate remaining unchanged at 3.75–4.00%, and the market reaction is expected to depend on whether the accompanying statement or the chair's remarks contain clues about the next rate hike.