In late New York trading, USD/JPY was stuck in the upper ¥157 range. The dollar weakened first against the backdrop of a sharp decline in crude oil, while yen-negative factors also emerged in cross-yen pairs, keeping attention focused on the possibility of elevated volatility ahead.
In late New York trading, USD/JPY was trading in the upper ¥157 range, with dollar weakness prevailing in the foreign exchange market against the backdrop of a sharp decline in crude oil. However, moves toward yen weakness were also seen in cross-yen pairs other than USD/JPY, and the market remained range-bound.
Crude oil has plunged on expectations of easing tensions in the Middle East. Reports said that President Trump was placing priority on assessing diplomatic negotiations before resuming attacks on Iran, with concerns among Gulf states cited as a contributing factor. A report that Iran's supreme leader had entrusted the government with negotiations was also cited as a follow-up development.
However, some observers have pointed out that volatility may remain elevated amid geopolitical uncertainty and ahead of tomorrow's US midterm elections. As for the political outlook after the election, expectations have been voiced that the Democratic Party will regain a majority in the House of Representatives.
Analysts have pointed to the risk that the Democratic Party will tighten regulation of the AI sector, saying this could encourage selling of IT and technology stocks and affect perceptions of US exceptionalism and the dollar.
The latest market indicators were USD/JPY 157.86, EUR/USD 1.1197, and GBP/USD 1.3412.