USD/JPY is expected to trade from the lower ¥154 range to the ¥155 range during European and U.S. trading hours. U.S. long-term interest rates remain at their highest level since 2007, while caution is spreading across the market ahead of tonight’s FOMC meeting.
The latest market information indicates an expected range of 153.800-155.400 for USD/JPY during European and U.S. trading hours. Although the pair temporarily dipped to around ¥154.21 in the Tokyo market, dollar buying driven by rising U.S. long-term interest rates prevailed, pushing it up to around ¥154.91 in the afternoon.
U.S. long-term interest rates have risen to around 5.02%, their highest level since 2007. If this movement continues in overseas markets, USD/JPY is expected to test the ¥155 range. Meanwhile, rate-hike pricing is reported to have exceeded 90% ahead of the FOMC meeting.
Tonight’s main events include speeches by several central bank officials and the release of key U.S. economic indicators. Particular attention is being focused on the U.S. 20-year Treasury auction, with $13 billion on offer. USD/JPY may also remain firm in the lower ¥154 range.