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✅ Testing the Sustainability of Yen Weakness — Fed Officials’ Remarks in Focus

✅ Testing the Sustainability of Yen Weakness — Fed Officials’ Remarks in Focus

💱 Yen Weakness Pauses but Remains Intact — ¥151 Becomes the Key Battleground

In Tokyo trading, both USD/JPY and cross-yen pairs extended gains beyond previous highs,
but momentum slowed as the ¥151 psychological threshold came into view.

The “Takaichi shock” that triggered rapid yen selling earlier in the week has now paused.
Markets are shifting focus toward the specifics of Prime Minister Takaichi’s new economic policies.

With the historically sensitive ¥151–¥153 zone—a past intervention area—coming into play,
investors are increasingly alert to potential verbal or actual yen-buying intervention by the Japanese authorities.
Even so, buying on dips remains active, keeping the broader yen-weak bias intact.

🏦 Fed Officials’ Remarks Take Center Stage amid Data Vacuum

Due to the U.S. government shutdown, the release of the nonfarm payrolls report is likely to be delayed,
leaving markets without a clear directional driver this week.

Other scheduled data—such as Canada’s international merchandise trade (Aug) and the Ivey PMI (Sep)—
are not expected to have major market impact.

Instead, attention has shifted to remarks from the following Fed officials:

  • Raphael Bostic (Atlanta Fed President)

  • Michelle Bowman (Fed Vice Chair)

  • Adriana Kugler / Mielan (Fed Governor)

  • Neel Kashkari (Minneapolis Fed President)

With labor-market data missing, these speeches represent the only meaningful clues to the Fed’s current policy tone.
A hawkish tone could reignite dollar buying, while cautious or dovish comments may extend downward pressure on the dollar.

📊 Market Overview & Technical Outlook

USD/JPY:
¥151 stands as a major psychological and technical line.
A clean breakout could trigger stop-driven buying toward ¥152,
but stronger verbal warnings from the BoJ or MOF could spark a sharp correction.

U.S. Dollar Index (DXY):
Rebounded from the Tokyo session low of 98.09, now trading near 98.43.
The short-term 10-day moving average (98.00) remains intact,
keeping a potential retest of the 98.50+ region in sight.

📈 Dollar Index: 98.42 (+0.31 / +0.31%)

📅 Key Themes Ahead

Theme Summary
🧭 Yen Weakness Sustainability Depends on Takaichi administration’s ability to deliver policy execution. The yen-selling bias remains.
💬 Fed Speeches With the jobs data absent, policy clues will hinge entirely on officials’ remarks.
⚠️ Intervention Risk A break above ¥151 could trigger renewed government warnings or intervention speculation.
📊 Technical Levels Sustained gains above ¥151 open the way toward ¥152+, while a drop below ¥150 may deepen the pullback.

🧭 Summary

The yen-weak bias remains intact, but upside momentum has cooled amid a lack of fresh catalysts.
Tonight’s Fed speakers may provide the decisive cue for near-term direction:

  • Hawkish tone → renewed dollar strength, potential break above ¥151

  • Dovish tone → increased probability of a temporary correction

In short, the market stands at a crossroads—awaiting guidance from Washington rather than Tokyo.

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