Dollar-Yen Pauses Near 155 Ahead of FOMC Decision as Markets Remain Cautious

The dollar-yen exchange rate held steady around 155.08 during the New York foreign exchange session on the 15th, showing minimal movement from the previous evening’s level of 154.97. With the Federal Reserve’s policy announcement looming the next day, traders adopted a cautious stance, keeping price action within a tight range near the key 155 threshold.

Dollar-Buying Momentum Persists Amid FOMC Anticipation

Despite a continuation of dollar-buying sentiment observed during the earlier Tokyo trading session, market appetite for pushing the pair higher remained subdued. Market participants largely refrained from taking aggressive positions, leading to a consolidation phase characterized by limited volatility. In the New York afternoon trade, the dollar-yen fluctuated between 154.21 and 155.24 yen.

Similar trends were observed in other major currency pairs. EUR/USD hovered near $1.1543 by 24:00, marginally weaker than its 22:00 reading of $1.1546. A fleeting uptick to approximately $1.1552 occurred around 23:30, but failed to breach the overnight peak of $1.1553 set during Asia-Pacific trading hours, prompting profit-taking and subsequent pullback. Meanwhile, EUR/JPY settled at 179.01 yen, marking an 8-sen gain from the prior session’s close at 178.93 yen.

Tokyo Session Highlights

Earlier in Tokyo, dollar-yen opened with a bullish tone amid growing speculation over potential rate hikes preceding the Fed meeting. Benchmark U.S. long-term yields stayed elevated, bolstering demand for the greenback. The pair advanced steadily from 153.37 yen, touching an intraday high of 154.96 yen before retreating slightly.

During mid-afternoon Asian trading, dollar-yen briefly surpassed 154.89 yen; however, selling pressure emerged as it approached the psychologically significant 155 mark. Traders reported increased position adjustments ahead of the policy decision. One fund manager commented that “profit-taking activity intensified near the 155 handle.” Another analyst added, “There is currently little conviction behind attempts to test new highs prior to the FOMC statement.”

Equity Markets and Economic Data

On the data front, China’s August retail sales increased 0.4% month-over-month, missing the projected 0.8% growth. Industrial output rose 5.2%, surpassing forecasts of 4.8%. Concurrently, the United Kingdom’s ILO unemployment rate for May through July came in at 4.9%, slightly below expectations of 5.0%.

Japan’s Nikkei 225 Index closed at 63,484.10, declining 8.89 points from the previous day. It opened at 63,190.37, peaked at 64,101.00, and dipped as low as 63,067.18 throughout the session.

Currency Pair Trading Ranges (15th)

Note: Trading ranges reflect reference values across the Tokyo and New York sessions on the 15th.

With eyes firmly fixed on the upcoming FOMC ruling, analysts suggest this pivotal moment could determine whether dollar-yen breaks convincingly past the 155 yen barrier or enters a corrective downturn. The path of U.S. long-term interest rates will continue to exert substantial influence over the pair’s near-term trajectory.

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