The dollar / yen pair is looking for an upside again. The higher-than-expected increase in employment growth in US employment data last weekend seems to have cleared some uncertainty about the outlook for the US economy, which was widespread in the market. The mood is widespread that the US economy is stronger than expected. Rising US bond yields are supporting the dollar’s appreciation. In the overseas market yesterday, the yield on 10-year US Treasury bonds exceeded the psychological point of 3.00% and is still at a high level of around 3.05%.
In addition, it is pointed out that the depreciation of the yen will intensify. Governor of the Bank of Japan Kuroda said yesterday, both of which emphasize the continuation of strong monetary easing measures. Although there are concerns about the dollar-yen movement, such as the bad yen depreciation and Kishida inflation, overseas funds are trying to sell yen at this opportunity.
Along with the dollar yen, the cross yen is generally sloping toward the depreciation of the yen. Today, the interest rate differential between Japan and Australia is widening further with the 50bp rate hike of the Australian Central Bank. With the announcement of the results of the ECB Board of Directors this Thursday, it is becoming easier to be aware of the differences in policy stances not only between Japan, the United States and Australia, but also between Japan and Europe. It seems that we can expect the yen to move in the direction of appreciation only when the market is adjusted autonomously.
The dollar-yen pair’s topside is at the 133.84 level, which was set in April 2002. Beyond this level, a psychological level of 135 yen is likely to be the next step.
Yesterday, I was alert because I assumed that there was little movement, but in the meantime, the dollar buying and yen selling were brought to the hedge funds, and the dollar yen surged to the 133 yen level. You missed the chance to buy it.
However, I don’t think this will settle down, so if I have a chance, I still want to buy.