BOJ Rate Hike Bets Tug at Dollar-Yen, Yen-Selling Pressure Remains

The dollar-yen pair held firm in the lower 159 range during Tokyo trading on August 13th, despite a brief bout of yen buying triggered by a report that the Bank of Japan is considering a rate hike by October.

A Japanese bank noted that there was no notable supply-demand imbalance due to the summer holiday season thinning out commercial flows. The pair traded at 159.26-28 as of 3:00 p.m., roughly 10 sen weaker for the dollar compared with 159.36-37 at 5:00 p.m. the previous day.

The dollar's safe-haven demand intensified on concerns over the Middle East outlook, but the yen's strength was short-lived as persistent yen-selling pressure remains entrenched in the market.