After the dollar-yen rate reached the mid-¥158 range in the New York market on the 14th, it is expected to trade while assessing movements in U.S. long-term interest rates. Movements in crude oil prices and developments at the FOMC and the BOJ are expected to influence the market outlook.
In the New York market on the 14th, the dollar-yen rate temporarily rose to ¥158.95, but then fell back to ¥158.05 as U.S. long-term interest rates turned lower. The euro-dollar rate fell to $1.1113 before recovering to around $1.1158, while euro-yen declined to ¥176.30 on risk-averse yen buying and euro selling.
In the Tokyo market, dollar-yen is expected to trade with the 200-day moving average at ¥158.57 in focus, while movements in U.S. long-term Treasury yields and crude oil prices are monitored. Crude oil prices have remained firm amid reports reinforcing expectations that they will stay elevated.
September's consumer price index rose 3.7% year on year, exceeding market expectations, while core CPI rose 2.6%. Meanwhile, the probability of a rate hike shown by FedWatch rose temporarily above 50% before returning to the 30% range, and views are spreading that the probability of rates being left unchanged remains high.
Officials close to the FRB chair took a cautious stance on an additional rate hike and indicated that they wanted to assess upcoming economic data. Comments by BOJ officials are expected to be interpreted as maintaining the position of leaving rates unchanged at the October meeting while suggesting a rate hike at the December meeting.