The dollar strengthened in New York trading, with dollar-yen rising to just below ¥158. U.S. equities and crude oil remained steady, and yen appreciation paused. Markets will continue to focus on developments following the FOMC and Bank of Japan policy decisions.
The dollar strengthened in today’s New York FX market, with dollar-yen rising to just below ¥158. Against a backdrop of stable U.S. equities and crude oil, the market is believed to have become less risk-averse, temporarily easing pressure for yen appreciation. Attention is now focused on developments following monetary policy decisions in Japan and the United States.
A hold at the FOMC is viewed as virtually certain, while expectations for a December rate hike are rising. Short-term markets are pricing in an approximately 80% probability, but the yen could move depending on the details of the announcement. A hold by the Bank of Japan is likewise expected, and many observers anticipate increased expectations for a December rate hike.
The euro continued its downtrend against the dollar, with euro-dollar falling to around $1.1135. Fiscal and political uncertainty in France and concerns about slowing economic growth are driving the move, increasing pressure on the euro. Euro-yen temporarily fell to around ¥175.60.
The pound came under moderate selling pressure, with pound-dollar trading in the low $1.33 range. Developments surrounding the U.K. budget proposal and an upbeat outlook for wage negotiations are influencing the market. Caution over policy developments remains high.
Overall, market attention is focused on developments following monetary policy decisions in Japan and the United States, as well as fiscal and price trends in major economies, with investors strongly inclined to await the next set of economic indicators.