💵 Dollar Strength Persists at the Weekly Open — Global Risk-Off Sentiment Deepens While USD/JPY Holds Firm
✅ Market Overview
The Asian session opened the week by fully carrying over the strong risk-off tone seen late last week.
Major equity indices in Tokyo, Shanghai, and Hong Kong all traded lower, reflecting a clear return of investor caution.
What particularly rattled the market was Bitcoin’s dramatic decline, which erased nearly all of its year-to-date gains (+30%).
This sharp move reinforced the theme of “capital exiting risk assets,” sending a chill across global markets.
Meanwhile, the FX market is showing a more complex dynamic:
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Risk-off → USD buying
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Equity weakness & negative sentiment → JPY short-covering
A classic tug-of-war between USD-buying and JPY-buying is developing.
Even so, USD/JPY started the week with shallow dips and solid underlying strength.
💱 FX Overview
USD/JPY briefly attempted to test the 155 handle but struggled as yen buying capped rallies.
So far, the pair has been trading steadily in the upper-154 range.
| Pair | Current Level | Notes |
|---|---|---|
| USD/JPY | around 154.70 | Risk-off persists, but yen selling bias remains |
| EUR/USD | mid-1.16s | Mild USD strength; buyers appear near 1.16 early |
| GBP/USD | low-1.31s | UK fiscal concerns continue to weigh on the pound |
Japan’s July–September GDP posted negative growth for the first time in six quarters,
but the market had already priced in the impact of “Trump tariffs,” so it did not trigger yen buying.
Long-term U.S. yields rose to 1.73%, but the reaction in FX was limited as yen carry trades remain firmly intact.
USD/JPY continues to show notable resilience.
📈 Outlook for U.S. Markets
U.S. equity futures are slightly higher in early trading.
With the market still digesting last week’s sharp drop, a stabilization in equities could help USD/JPY retest the 155 level.
The biggest focal point of the week:
▶ U.S. September Nonfarm Payrolls (scheduled for the 20th)
After weeks of “data blackout” caused by the government shutdown,
the market will finally receive a major U.S. economic release.
Volatility may rise even before the release due to early headlines or leaks.
🌍 Key Economic Data Today
| Time | Region | Indicator | Importance |
|---|---|---|---|
| — | 🇺🇸 | NY Fed Manufacturing Index (Nov) | ★★ |
| — | 🇺🇸 | Construction Spending (Aug) | ★ |
| — | 🇨🇦 | Housing Starts (Oct) | ★★ |
| — | 🇨🇦 | CPI (Oct) | ★★★ |
The Canadian CPI carries high market impact;
CAD/JPY and USD/CAD warrant extra attention today.
🗣 Key Speeches & Events
| Speaker | Institution | Key Focus |
|---|---|---|
| de Guindos | ECB | Eurozone economic and inflation outlook |
| Knot / Schrempf | Dutch CB | Policy stance |
| Mann | BoE | View on UK inflation slowdown |
| Williams | NY Fed | U.S. financial conditions |
| Jefferson | Fed Vice Chair | Rate-cut timing hints |
| Lane | ECB | Price stability |
| Kashkari | Minneapolis Fed | Inflation persistence risk |
| Waller | Fed | Rate hold justification |
Fed communication will heavily influence the dollar this week.
Even subtle hints about the rate-cut timeline may trigger immediate market reactions.
📊 Dollar Index (DXY) Snapshot
The dollar index is trading around 99.41 (+0.11%),
hovering near the 21-day moving average (99.35).
| Indicator | Level | Notes |
|---|---|---|
| DXY | 99.41 (+0.11%) | Supported by risk-off flows |
| 21-day MA | 99.35 | Functioning as support |
🧭 Summary
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Risk-off sentiment persists globally, but USD strength outweighs JPY demand
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USD/JPY remains firm in the upper-154s, though the 155 breakout is not easy
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This week’s dominant themes are U.S. NFP + Fed commentary
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If risk-off deepens, cross-yen pairs may fall, while USD/JPY becomes less reactive
📌 Key Takeaways for Today
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Global equity weakness + BTC’s sharp drop reinforce risk aversion
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“USD buying × JPY short-covering” creates complex FX flows
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USD/JPY remains stable around the upper-154 area
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This week’s main catalysts: U.S. jobs data and Fed speeches
