Dollar-yen is expected to trade in a ¥155.50–¥159.00 range next week. The upside surprise in core CPI for Tokyo's 23 wards and renewed expectations for a BOJ rate hike are expected to be key factors, with ¥158.50 and ¥156.65 drawing attention as turning points.
This week's trading was confined to a ¥156.38–¥158.46 range. Expectations for consecutive BOJ rate hikes in October receded, while the upside surprise in Tokyo core CPI suggested that expectations for an additional rate hike could return. Dollar-yen could face upside constraints depending on U.S. interest-rate movements. Remarks by Governor Ueda (植田) and the Finance Minister are cited as a focus for the market.
Looking ahead to next week, with expectations for October rate hikes in both Japan and the United States still lacking a decisive catalyst, dollar-yen is considered likely to remain within a ¥155.50–¥159.00 range. Attention is focused on whether remarks by senior Fed officials and the employment report will provide a catalyst for a break out of the range.
From a technical perspective, the 200-day moving average at ¥158.50 is a turning point. The lower end is supported around ¥156.65, while resistance is seen near ¥159.00. The employment report and remarks by Governor Ueda (植田) and Finance Minister Katayama (片山) are likely to determine the direction.