Week in review
The USD/JPY opened the week at 150.92. The pair became top-heavy on 20 October following hawkish comments from BOJ policy board member Hajime Takata. However, yen selling gained momentum when the extraordinary Diet session convened on 21 October after the LDP and Nippon Ishin no Kai reached a coalition agreement. The USD/JPY climbed into the 151 range and extended gains toward 152. The pair briefly stalled around that level, then rose further on 23 October driven by higher oil prices, rising UST yields, and a stronger dollar. It approached 153 on 24 October at the time of writing, reaching into the 153 range during Prime Minister Sanae Takaichi's policy speech (Figure 1). Among G10 currencies this week, petrocurrencies such as the Norwegian krone and the Canadian dollar strengthened as the US dollar was bought back, while the yen weakened broadly (Figure 2).
FIGURE 1: USD/JPY
Note: As at 15:00 JST on 24 October
Source: EBS, Refinitiv, MUFG
FIGURE 2: MAJOR CURRENCIES' RATE OF CHANGE VS USD THIS WEEK
Note: As at 15:00 JST on 24 October
Source: Bloomberg, MUFG