The dollar strengthened on expectations of a US rate hike, with USD/JPY rising to the mid-¥160s in the Tokyo morning session. Meanwhile, the NZ dollar plunged after the policy rate was raised.
USD/JPY rose to around ¥160.39 in the Tokyo morning session as the dollar strengthened. Expectations of a US rate hike this month have grown on the back of a speech last week by Federal Reserve Chair Waller and higher crude oil prices.
NZD/JPY plunged to around ¥93.71. Although the Reserve Bank of New Zealand raised its policy rate for the second consecutive meeting, its slight downward revision to the OCR forecast prompted selling of the NZ dollar.
AUD/JPY rose to around ¥114.67, but gains were capped by the weaker NZ dollar. Trading was driven more by movements in other currencies than by domestic factors.
EUR/JPY traded in the upper ¥185 range and GBP/JPY in the mid-¥216 range, with little movement. No notable price moves were seen in European currencies or the yen.