Dollar/Yen Retreats from Lower-160 Yen Range Amid Paused Buying

The dollar/yen pair retreated from its lower-160 yen range to settle in the upper-159 yen range on August 31, as buying following Federal Reserve Chair Warsh's weekend remarks unwound.

Warsh's comments signaled a proactive stance on curbing inflation, but the rise in U.S. interest rates took a breather, and dollar buying paused.

Market participants noted that Warsh's remarks alone lacked the impact to push dollar/yen decisively above 160 yen, with some attributing this to the prevailing view that whether the Fed raises rates in September hinges on upcoming economic data.

Takuya Kanda, senior FX analyst at Gaitame.com Research Institute, analyzed that even if Warsh is hawkish, the economy is not as robust as it was several months ago, including employment figures.