US Dollar Stalls Recovery Below Key Moving Averages

USD/JPY prices have stalled their recovery below key moving averages, despite the Japanese Yen holding firm in thin holiday trading during Japan's Silver Week.

The US Dollar Index (DXY) has been supported by expectations of further Federal Reserve interest rate hikes, reaching levels last seen in late July.

Analysts at MUFG noted that the Yen initially weakened sharply after the BoJ's latest policy update on Friday, with USD/JPY hitting a high of 158.05 before dropping back towards 157.00.

The trigger for the late-Friday rebound was reports that the BoJ had conducted a rate check during the New York trading session, sending a clear signal that they are prepared to intervene again if the Yen continues to weaken.