USD/JPY recovered to the 157 range in the London market, then plunged to 156.86 shortly afterward before returning to the 157 range again amid oil market developments and lower U.S. Treasury yields. The high reached around 157.78.
USD/JPY attracted buying early in the London session today and temporarily reached a high of around 157.78, but then plunged to around 156.86 in tandem with a sharp reversal in NY crude oil futures. The move was apparently driven by developments in the oil market and lower U.S. Treasury yields.
Across the yen market, lower oil prices eased concerns about a deterioration in Japan's terms of trade and prompted yen buying, while USD/JPY came under stronger dollar-selling pressure due to the decline in U.S. Treasury yields. The pair is currently holding around 157.10 after the decline, and the sharp price movements have begun to settle.
Reports on the 19th said that Iran may accept a proposal to reopen the strait "within 7 days," drawing market attention as a potential catalyst for oil prices. USD/JPY may continue to be driven by developments in oil prices and U.S. interest rates.