The yen remained in a narrow range in the upper ¥157 range to the dollar, as investors increasingly stayed on the sidelines ahead of the US midterm elections and the release of employment-related indicators.
In New York trading at the start of the week, the yen moved in a range of ¥157.89–¥157.99 to the dollar, weakening against the dollar from its level at the end of the previous week. Market participants refrained from active trading while assessing the US midterm elections and the release of various employment-related indicators.
This week, a series of labor-market indicators is due, including the US October employment report on the 6th, as well as the JOLTS and ADP national employment reports. The ISM Manufacturing PMI was released on 5 October at 55.5, above the previous month's 54.5, prompting a broad view in the market that it indicated resilience in the US economy.
The sharp decline in crude oil futures and the fall in long-term US interest rates supported the yen's downside, at times offsetting factors contributing to yen weakness and pressure on the exchange rate. Finance Minister Katayama (片山) suggested that lower US interest rates and a weaker dollar could lead to a stronger yen depending on the election outcome.
Technically, ¥158.60 and ¥158.95 are being watched as upside levels for dollar-yen, while the lower edge of the cloud at ¥156.80 and the low of ¥156.08 are viewed as downside reference levels. This week, the market is expected to continue monitoring US interest-rate trends and dollar-yen movements in light of the ISM Services Index and employment report results.