The yen remained locked in a narrow range against the dollar in October, with its trading range at its narrowest in four and a half years. While structural yen selling remains, some believe investor activity is beginning to settle down. Others point to the thinness of the foreign exchange market as a contributing factor.
As the yen remains locked in a narrow range in the foreign exchange market, its trading range against the dollar in October reached its narrowest level in four and a half years. Structural yen selling remains, while investor activity is reportedly beginning to settle down.
Kaida Kazushige (貝田和重) of the Tokyo Branch of State Street Bank said, “Trading volumes were extremely low, and it was a truly terrible market,” indicating that the thinness of the market was weighing heavily on participants.
There is also speculation that fund flows from hedge funds and others that drove the yen's depreciation in the first half of fiscal 2026 have begun to settle down, drawing attention to future market developments.