Against the backdrop of US and Japanese interest-rate developments next week, USD/JPY is expected to test 160 again. The view is that a hawkish FOMC rate hike and the BOJ’s dovish stance will intensify downward pressure on the yen.
USD/JPY is expected to test levels around 160 next week. The FOMC’s rate hike may leave a hawkish impression on the market, while the BOJ’s rate hike may be viewed as dovish, potentially creating a catalyst for yen selling. BOJ Governor Ueda (植田) did not specify the pace of future rate hikes and indicated that policy decisions would be made through discussion. Finance Minister Katayama’s (片山) willingness to conduct coordinated intervention also heightened market caution over intervention.
Although yen buying was briefly seen after the BOJ’s monetary policy meeting, yen selling ultimately prevailed, and USD/JPY is expected to continue testing higher levels. Next week, US economic data and comments from speakers will be market drivers, and a break above the mid-158 range could set the stage for a move toward 160. Events scheduled for late September include US PMI data, housing-related indicators, and speeches by the US president and Federal Reserve officials.