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The yen maintained its strength against other major currencies, with the euro dropping from 158 yen to 157 yen. Analysts suggest that this uptick in yen buying may represent a strategic position adjustment in anticipation of the FOMC meeting. Market sentiment remains highly focused on the outcomes of the meeting, which could shape future currency movements.
On September 16, while the Japanese market was closed, the yen briefly surpassed the 140 yen mark, hitting 139.58 per dollar. This surge was driven by speculation that the Federal Open Market Committee (FOMC) would implement a 50 basis point interest rate cut, double the usual amount. Meanwhile, expectations are that the Bank of Japan (BOJ) may reinforce its stance on monetary easing at its upcoming meeting on September 19-20, should its economic outlook persist.
Market sentiment has been shifting as traders anticipate the outcome of the upcoming Federal Open Market Committee (FOMC) meeting, scheduled for September 17th and 18th. There is considerable debate over whether the Federal Reserve will implement a 25 basis point (bp) or a more substantial 50 bp rate cut. Currently, the market is pricing in a rate cut of approximately 34 bp, up from 26 bp on September 11th, reflecting heightened expectations of a more aggressive reduction.