Dollar Steady as Yen Soars Near Seven-Month High Amid BOJ Hike Expectations

The dollar has remained steady despite expectations of possible rate hikes from the Federal Reserve and Bank of Japan. The yen, on the other hand, is near a seven-month high due to bets on BOJ tightening and capital repatriation.

Market participants are pricing in an 86% chance of a 25 basis point rate hike by the BOJ at its September 17-18 meeting. This has led to further gains for the yen, which is up 4% this month.

The dollar's steady performance can be attributed to synchronized tightening expectations from other central banks, which have capped its gains despite rising short-term Treasury yields.