In the Tokyo market, the USD/JPY (dollar/yen) rate dropped to 147.35 yen at one point due to a risk-off trend, meaning investors were buying yen. This happened because of the decline in Japan’s Nikkei stock average and the large drop in Hong Kong’s Hang Seng index. However, later on, the USD/JPY rate rose to 148.37 yen because U.S. long-term interest rates went up to around 4.05%. The movement of the dollar and yen has been hard to predict.
This shift is likely because investors are paying attention to the U.S. Consumer Price Index (CPI) for September, which will be announced today. The market’s focus is moving from the labor market back to inflation data. It’s expected that inflation will slow down, with the rate dropping from 2.5% to 2.3%. However, because the labor market and the economy remain strong, there is still a positive mood among investors, and this may limit how much the dollar drops. On the other hand, since the rate is approaching the 150 yen mark, there is caution about possible intervention by Japan, which may keep the dollar from rising too much.
In the end, the USD/JPY is expected to move within the range of 147 yen to 149 yen.
USD/JPY expected range: 147.50 yen to 149.00 yen (50%).
Note: The above information does not guarantee profit, so please make your own decisions when trading.