USD/JPY: fluctuates on ceasefire expectations
Week in review
The USD/JPY opened near its high for the week at 160.24. It fell below 160 soon after the BOJ released its Summary of Opinions from the Monetary Policy Meeting on the morning of 30 March and after Vice Minister of Finance for International Affairs Atsushi Mimura warned against yen weakness. The pair then fell sharply in overseas trading on 31 March after reports that US President Donald Trump intended to seek a ceasefire, with Iran also apparently responding to that development. It fell to a low of 158.28 by European trading on 1 April. The dollar then strengthened broadly in Tokyo trading on 2 April after a speech by Trump, pushing the USD/JPY back above 159 and then beyond 159.50. The pair was still trading around that level at the time of writing on 3 April (Figure 1). The dollar weakened across the board among G10 currencies early this week, but those moves were reversed after Trump delivered his speech, leaving weekly gains and losses for each currency at roughly within 1% (Figure 2).
FIGURE 1: USD/JPY
Note: As at 13:00 Tokyo time on 3 April
Source: EBS, Refinitiv, MUFG
FIGURE 2: MAJOR CURRENCIES' RATE OF CHANGE VS USD THIS WEEK
Note: As at 13:00 Tokyo time on 3 April
Source: Bloomberg, MUFG