USD/JPY fell into the lower ¥158 range today. With expectations of a Bank of Japan rate hike and US monetary policy in focus, the yen strengthened and the dollar weakened, while renewed movement is expected in overnight trading.
In foreign exchange markets from 2 September through the early hours of 3 September, Bank of Japan Policy Board member Takata (高田) referred to the possibility of consecutive rate hikes, shifting sentiment around changes in US and Japanese monetary policy. The market priced in a 25-basis-point rate hike in September, while attention also turned to the possibility of an additional hike before year-end.
Australia's GDP rose 0.4% quarter on quarter in the April-June period, exceeding market expectations, while growth reached 2.1% year on year. Although some uncertainty remains over the growth outlook, the economy expanded by more than expected.
US ADP employment rose by 38,000 in August, below expectations, with employment also declining in the manufacturing sector. This prompted speculation over the implications for future employment conditions and interest-rate trends.
New York Fed President Williams said there were signs that inflation was slowing and indicated that the need to rush to raise interest rates was limited. The dollar was sold to some extent as a result, but overall market pricing remained cautious.