Dollar-Yen Fluctuates Amid Tokyo Inflation Surprise and BOJ Policy Tensions
The dollar-yen exchange rate is expected to fluctuate between 155.50 and 159.00 next week, driven by Tokyo's inflation surprise and the potential for a Bank of Japan policy adjustment.
Naoto Ono from Gaitame.com Research Institute forecasts that resistance near 159 will cap any gains, while the pair should hold firm in the upper 155 range on the downside.
Last week, dollar-yen traded between 156.38 and 158.46 within a previously forecasted range of 156.00-159.60. However, October rate hike speculation receded following the BOJ's September monetary policy meeting summary, which showed the Cabinet Office representative calling for a review of past rate hikes.
A sell-off in French government bonds triggered turmoil in the European bond market, prompting a flight-to-safety bid into U.S. Treasuries and sending long-term U.S. yields sharply lower.