Will the U.S. Dollar Rebound as the Yen Continues to Strengthen?

Will the U.S. Dollar Rebound as the Yen Continues to Strengthen?

09.09.2026 New

In the U.S. currency market the previous day, the dollar fell against the yen. Although expectations for a U.S. interest rate hike in September strengthened following strong U.S. employment data released last weekend—and the yield on the 10-year U.S. Treasury note rose to around 4.8%—yen buying prevailed amid speculation that the Bank of Japan would raise interest rates further.The dollar-yen pair peaked at 154.45 yen before falling to 152.89 yen, closing near 153.45 yen.Today, the pair continues to trade mainly in the low 153-yen range, with the unwinding of short yen positions also supporting the yen. We will be watching to see if the 152.89-yen level holds as support or if we see a rebound toward 154 yen.

Among European currencies, the euro fell slightly against the dollar but remained in the $1.16 range. The euro-dollar pair, which had hit a high of around $1.1636 the previous day, fell to the upper $1.160 range and closed in the $1.161 range.Today, it has rebounded once again to around $1.163. While Germany’s July exports fell 0.8% month-over-month—contrary to market expectations—weighing on the economy, the euro is being supported by inflationary pressures from rising crude oil prices and speculation about monetary policy ahead of the ECB’s policy meeting the following day.We will be watching to see whether the $1.1600 level holds as support or if the pair breaks above the previous day’s high.

Today’s economic data included the release of China’s August CPI and PPI at 10:30 a.m. The CPI came in at 0.8% year-over-year, as expected, while the PPI came in at 3.8%, exceeding the forecast of 3.6%.Looking ahead, France’s July industrial production is scheduled for release at 3:45 p.m., with the market expecting a 0.2% month-over-month increase. At 8:00 p.m., the U.S. MBA Mortgage Applications Index will be released, followed by Mexico’s August CPI at 9:00 p.m., which is expected to rise to 3.30% year-over-year from the previous reading of 3.12%.In Europe, with the ECB Governing Council meeting scheduled for the following day, we will be monitoring the potential for a rebound in the dollar-yen pair and the euro’s ability to hold above the 1.16-dollar level, respectively.