Ahead of the U.S. jobs report, the market is watching to see how the battle for the 162-yen level in the dollar-yen pair plays out

Ahead of the U.S. jobs report, the market is watching to see how the battle for the 162-yen level in the dollar-yen pair plays out

02.07.2026

In the U.S. currency market the previous day, the June ADP employment report showed an increase of 98,000 jobs—a slowdown from the previous month’s gain of 122,000—leading to a somewhat cautious view of the momentum in the U.S. job market.Meanwhile, although the U.S. June ISM Manufacturing PMI fell to 53.3 from 54.0 the previous month, it remained above 50—the threshold separating expansion from contraction—indicating that the U.S. manufacturing sector continued to expand.The dollar-yen pair traded within a range of 162.54 to 162.84 yen in the Tokyo market and was in the upper 162.60 yen range as of 5:00 p.m.The focus now is on whether the pair can hold around 162.50; on the upside, the 163.00 level is likely to be watched, while on the downside, the 162.00 to 161.50 range is likely to be a key area of interest.Today’s U.S. June employment report is scheduled for release; we will be watching to see whether the trend of a stronger U.S. dollar and a weaker yen continues, based on the nonfarm payrolls, unemployment rate, and average hourly earnings.

European currencies rose as the market took note of the view that the need for the European Central Bank (ECB) to rush into further interest rate hikes had eased somewhat, following the release of the eurozone’s June Harmonized Index of Consumer Prices (HICP, preliminary reading), which came in at 2.8% year-over-year—a slowdown from the previous month’s 3.2% and below market expectations.The core HICP also fell to 2.4% from 2.6% the previous month, confirming an easing of inflationary pressures.Meanwhile, the euro-dollar pair traded in a range of 1.1394 to 1.1419 in the Tokyo market, weighed down by the U.S. dollar’s strength near record highs, and stood near 1.1400 as of 5:00 p.m.Resistance levels around 1.1420 to 1.1450 and support levels around 1.1380 to 1.1350 are likely to be closely watched, and the immediate focus will be on whether the pair can hold steady near 1.1400.The eurozone’s May unemployment rate is scheduled for release today, and we will be watching to see how the euro reacts to the employment data.

Today’s key economic indicators include the Swiss Consumer Price Index (CPI) for June at 15:30, the Eurozone unemployment rate for May at 18:00, the U.S. nonfarm payrolls change for June, the U.S. unemployment rate for June, and average hourly earnings for June at 21:30,the previous week’s initial jobless claims and continuing claims, and at 23:00, U.S. May manufacturing new orders. In particular, during New York trading hours, the U.S. employment report and unemployment insurance-related indicators will be released simultaneously, so we will carefully assess whether a clear direction emerges for the U.S. dollar, the yen, and the euro.