Dollar-Yen Volatility Subsides Amid Thin Liquidity and Upcoming Policy Announcements

The dollar-yen pair saw significant volatility in New York foreign exchange trading on August 4th, initially surging to 156.75 yen after the U.S. employment report far exceeded market expectations.

However, once the initial buying wave subsided, the yen was bought back on the back of yen-buying verbal intervention from Japanese currency authorities and speculation of an additional rate hike by the Bank of Japan.

The pair ultimately settled in the low-156 yen range after paring losses.

In Tokyo trading today, participation is expected to thin out as U.S. and Canadian markets are closed for the Labor Day holiday.