Speculative yen-buying retreats as prospects dim for big U.S. rate cut

Future forex trends could hinge on the return of yen carry trades

20241007N dollar-yen bills

Growing speculation that the U.S. Federal Reserve will forego a big rate cut in December is putting downward pressure on the Japanese yen.  © Reuters

GENKI IKUTA, Nikkei staff writer

TOKYO -- Speculative yen-buying is shrinking in the foreign exchange market, pushing the Japanese currency down near 150 against the U.S. dollar, as expectations for a large interest cut by the Federal Reserve Board faded on surprisingly robust jobs numbers released last week.

The jobs data helped dispel concerns about the U.S. economy, with market watchers now predicting a rate cut next month that is smaller than anticipated earlier.

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