Dollar-Yen Tug-of-War Continues Amid Yen-Weakening Warnings
The dollar-yen pair has been in a tug-of-war in New York trading, with market participants wary of US pressure to correct yen depreciation. Japanese Finance Minister Satsuki Katayama revealed that President Trump expressed concerns about yen weakness during the Japan-U.S. summit, and Prime Minister Sanae Takaichi indicated that undervaluation of the yen is problematic.
This triggered stronger selling in dollar-yen, which fell to 157.67 yen at one point before recovering to the 158 range. The pair has not staged a major rebound since, with selling momentum temporarily subsiding but not entirely disappearing.
The August US Durable Goods Orders report was released during New York trading hours, showing a 1.6% month-over-month increase in core capital goods orders, significantly beating market consensus of a 0.5% gain. However, yen buying remained dominant after the release, with government statements warning against yen depreciation weighing on the pair.
As of now, technical levels indicate resistance at 158.61 yen and support at 156.83 yen, with a breakout from this range possible if US Durable Goods Orders results deviate significantly from expectations.