Following the U.S. midterm elections, USD/JPY briefly came under dollar-selling pressure but rebounded, then traded in the upper 157 yen range in the Tokyo morning. Euro weakness was reinforced, the dollar’s weakening trend continued, and moves in the British pound were limited. Lower oil prices and weakness in U.S. stocks prompted risk-averse yen buying.
Following yesterday’s U.S. midterm elections, USD/JPY briefly came under dollar-selling pressure, touching 157.41 yen before rebounding to the 158.60 yen range. In the Tokyo morning, dollar selling and yen buying intensified after it reached a high of 158.44 yen, and it fell to 157.79 yen before noon, after which it traded in the upper 157 yen range.
Dollar weakness dominated in EUR/USD, while falling oil prices encouraged euro buying and dollar selling. After reaching 1.1273 in the European market, it fell to 1.1213 in the New York market and traded in the 1.1220 range in the Tokyo morning. It then edged higher as the dollar weakened, reaching 1.1268 in the afternoon and approaching the previous day’s high.
GBP/USD remained firm on dollar-selling flows despite the Bank of England meeting ahead, but rose only modestly, from 1.3468 to 1.3497. EUR/JPY continued to trade in the upper 177 yen range, while GBP/JPY was sold from the lower 213 yen range to below 213 yen.
Risk-averse yen buying spread across the market that day, while falling share prices and lower oil prices weighed on the dollar.