Yen touches 160 as Japan's Katayama warns of one-sided moves

The yen weakened to 160 per dollar for the first time since September, according to Investing.com, as the dollar scaled a fresh 19-month peak on Fed hike bets. Tokyo pushed back quickly. Japan's Katayama warned of one-sided yen moves near 160 and said Japan will coordinate with the US Treasury, investingLive reports.

Tokyo raises the stakes at 160

investingLive says Katayama's comments make intervention a more serious risk for anyone pushing dollar-yen above 160, especially now that the US has been confirmed as a willing partner. The outlet expects choppy, headline-driven trading around that level, with dealers alert to any reports of rate checks.

The same report notes that the underlying pressure on the yen remains. Rising Fed hike expectations keep rate differentials in the dollar's favour. For background on why round numbers like this matter, our sister site explains how support and resistance work around USD/JPY's 159 level. You can follow the pair on the USD/JPY chart and the broad dollar on the DXY chart.

The majors in the ECB fixings

The latest ECB reference rates are from Thursday, 12 November. They show broad dollar strength over the past week.

The Australian dollar was the weakest major over five fixings, down 2.56%. USD/CAD and USD/CHF both gained around 2%. USD/CNY was flat at 6.668 over the same period.

Fed speakers, auctions and US data

Fed officials kept the tightening debate alive. In its Americas wrap, investingLive reports that Fed's Hammack said the Fed needs to move to restrictive policy to lower inflation. Goolsbee said inflation has been well above target. Daly was more cautious, saying how much tightening and when is not a decision for right now.

Demand for long-dated US debt softened again. The US Treasury sold $25 billion in 30-year bonds at 5.441%, a 0.4 basis point tail against the 5.437% when-issued yield, according to investingLive. The bid-to-cover was 2.36x against a 2.44x average. It was the second disappointing auction in two days.

On the fiscal side, the US posted a record October budget deficit of $404 billion against $284 billion a year earlier, investingLive reports. Housing was weak too. October existing home sales came in at 3.75 million against 3.85 million expected, per investingLive.

Iran strikes and oil

Geopolitics added to the mood. Oil prices rose after Iran's state IRNA news agency confirmed that Sirik in Hormozgan Province had been targeted, investingLive reports. The outlet said the attack was weighing on risk assets. Separately, President Trump said he would not hesitate to use military force against Iran if necessary and would consider a week-long campaign against Cuba, according to investingLive.

New Zealand factories hold up

New Zealand's manufacturing PMI eased to 54.9 in October but extended its expansion run to 16 months, investingLive reports. The outlet said the small fall should do little to change the outlook for the RBNZ or the kiwi. It flagged fuel prices and election uncertainty as near-term concerns.

What to watch next

• Yen intervention risk: any reports of rate checks or joint action with the US Treasury near 160, as flagged by investingLive.
• Fed rhetoric: further comments on how much tightening is needed, after Hammack, Goolsbee and Daly.
• Treasury demand: whether weak long-end auctions keep pressure on US yields.
• Iran and oil: further strikes and their effect on oil and risk appetite.
• New Zealand: election uncertainty, which investingLive calls a near-term drag on business.