In European and U.S. foreign exchange markets on the 19th, the dollar-yen pair is expected to resist further declines, while trading is likely to remain cautious as the market watches yen-cross movements despite waning expectations for an early U.S. rate hike.
In European and U.S. foreign exchange markets on the 19th, the dollar-yen pair is expected to resist further declines. The euro-dollar pair held near $1.1210, while the dollar-yen pair rose into the lower ¥158 range before losing momentum. The trend toward lower U.S. interest rates and a weaker dollar is seen as potentially supporting yen crosses.
Oil prices have strengthened amid growing concerns that the conflict in the Middle East will be prolonged, making them a focus of inflation risks. Meanwhile, long-term U.S. interest rates have remained high, although their rise has been contained, and dollar buying has been losing momentum.
Ahead of next week's Federal Open Market Committee (FOMC) meeting, expectations for additional rate hikes have receded, and some market participants believe dollar selling could intensify. The BOJ's Monetary Policy Meeting is expected to result in the continuation of current policy, making yen buying difficult to anticipate.
If dollar selling progresses under these conditions, yen crosses are likely to remain firm, making the dollar-yen pair difficult to push lower. Oil price movements and U.S. monetary policy will be the most pressing points of focus in overseas markets ahead.