With USD/JPY continuing to move in a narrow range around ¥158, this week's focus is expected to be on movements in long-term interest rates and concerns over European fiscal conditions. Some market views suggest that if the US dollar rises well above ¥159, intervention by the Japanese and US authorities could resume.
USD/JPY is currently moving around ¥158 with little momentum, but movements in global long-term interest rates could affect its future direction. An analyst at Monex Securities explained that a move above ¥159 could signal the possibility of renewed intervention. This week's forecast range has been set at ¥155–¥160.
Looking back at last week, USD/JPY remained within a range of just over ¥1, while EUR/JPY struggled to extend its decline. Movements in interest-rate differentials were a key factor determining the direction of the euro, and pressure toward a stronger US dollar and weaker yen was considered limited.
In Europe, concerns about fiscal discipline, particularly in France, remain simmering, while some market observers believe the euro's weakness has eased as movements in long-term interest rates have paused. Although there are concerns that the European debt crisis could flare up again, some have pointed out that Europe's experience in addressing such issues is influencing market sentiment.
Overall, this week's focus will be on movements in long-term interest rates, the possibility of intervention by the Japanese and US authorities, and the market's response to European fiscal discipline. Whether intervention takes place and how the forecast range develops are expected to depend on news developments.