The dollar fell to the mid-¥157 range in the Tokyo market as September Tokyo CPI exceeded market expectations, heightening expectations of an early BOJ rate hike. Key points on the level and background as of 5 p.m.
The dollar-yen rate fell to the mid-¥157 range in the Tokyo foreign exchange market on the afternoon of the 2nd. Position-adjustment selling ahead of the US employment report appeared to intensify toward the end of the session. As of 5 p.m., the dollar stood at ¥157.58–¥157.59, down ¥0.80 from the previous day against the yen.
The September Tokyo CPI headline index, released at 8:30 a.m., rose 2.7% year on year, exceeding the market forecast of 2.4%. This brought expectations of an early BOJ rate hike into focus, and the dollar temporarily fell to the ¥157.70 range.
Dollar demand and yen selling by domestic importers prevailed toward the fixing, pushing the dollar back to the ¥157.80 range. Buying then strengthened somewhat toward noon, allowing it to recover to the ¥158 range. In the afternoon, trading was again range-bound near the lows, in the ¥157.70–¥157.90 range.
The decline accelerated as European traders entered the market, with the dollar at times falling to the ¥157.50 range. Many market participants said the main factors were a lack of fresh news and position-adjustment selling ahead of the US employment report. The euro fell sharply against both the yen and the dollar.