USD/JPY held firm in the upper ¥158 range in Tokyo trading on the afternoon of the 24th, supported by expectations for the U.S. fiscal consolidation program scheduled to be announced this week.
The day's trading ranges were ¥158.70–¥159.00 for USD/JPY, ¥185.44–¥185.66 for EUR/JPY and $1.1673–$1.1687 for EUR/USD.
Pressure for a weaker yen and stronger dollar remains firm in the foreign exchange market. Against the backdrop of worsening Middle East tensions and higher crude oil prices in late February, inflation has advanced globally and expectations for interest-rate hikes have spread across many countries.
Concerns about Japan's fiscal management continue to smolder, while market participants remain wary of currency intervention. If the U.S. fiscal consolidation program scheduled for release this week presents concrete measures, it could help restore confidence in the dollar. If it falls short of expectations, however, there is also a risk that dollar selling will resume.
The focus ahead is the market reaction to the contents of the fiscal consolidation program, as the market enters a phase in which the continuation of the weak-yen trend will be assessed more closely.