Yen surges as USDJPY breaks 158.00, oil declines

The yen has taken the lead among currencies today. The greenback has fallen 0.77% versus the Japanese currency, with USDJPY changing hands near 157.61. Finance Minister Satsuki Katayama stated that President Trump brought up the issue of yen softness in his talks with Prime Minister Sanae Takaichi. According to Katayama, Takaichi responded that, as a general rule, a weak yen poses problems.

The pair has also dropped beneath its 200-hour moving average and the 50% Fibonacci retracement level around 158.45, as well as the swing zone near 158.00. As long as the price remains under these thresholds, sellers hold the upper hand. To begin mending the near-term technical outlook, buyers must first recapture 158.00 and then 158.45.

The US dollar is showing a mixed performance but is predominantly weaker. It has lost ground against the euro, yen, pound, Australian dollar and New Zealand dollar, while rising against the Swiss franc and Canadian dollar. The yen has recorded the biggest gain versus the dollar.

At 7:40 AM ET, US stock futures are pointing higher, supported by declining oil costs and optimism over more stable ties between China and the US. The following are the index futures levels:

• Dow futures: up 160 points
• S&P 500 futures: up 28.12 points
• Nasdaq futures: up 200 points

One prominent exception to the upbeat equity sentiment is Costco. Its stock is falling even though the company reported fiscal fourth-quarter results that topped forecasts. Profit came in at $6.75 per share, compared with an expected $6.54, and revenue reached $95.72 billion versus a projected $94.97 billion. This serves as a reminder that surpassing analyst estimates does not automatically lead to a higher share price; investors also consider what was already discounted and their forward expectations.

Treasury yields are displaying a mixed picture with minimal changes. The following are the current yields:

• 2-year: 4.8869%, down 0.81 basis point
• 5-year: 5.0232%, down 0.38 basis point
• 10-year: 5.1688%, up 0.68 basis point
• 30-year: 5.4671%, up 0.51 basis point

Crude oil has fallen 2.40% to $92.43 as market participants assess the potential for advancement in US-Iran relations. Iranian President Masoud Pezeshkian stated that Tehran aims to revive a ceasefire agreement before the November midterm elections and is willing to allow inspections of its nuclear sites. A potential step-by-step arrangement under consideration would include the reopening of the Strait of Hormuz and the removal of the US blockde. These remarks suggest a possible way forward, but oil traders will await concrete actions from both parties.

Gold is gaining alongside a generally weaker dollar, and Bitcoin is posting a slight rise.

On the North American economic calendar, August durable goods orders are scheduled for release at 8:30 a.m. ET, followed by the final September University of Michgan consumer sentiment index at 10:00 a.m. ET. Durable goods orders are anticipated to decline 0.4%, after rising 1.1% in July. The preliminary sentiment reading stood at 47.8, and the consensus estimate is 47.6; traders will also monitor shifts in inflation expectations, which were 4.6% for the one-year outlook and 3.4% for the five-year outlook in the initial report.