Usd/jpy approaches 160 as fed speakers and us ppi loom
ITF Team2 min read
Usd/jpy nears 160.00 for the first time since early september, driven by fed governor waller’s hike expectations and upcoming us ppi data on nov 13.
Key takeaways
- Usd/jpy touched just under 160.00 on nov 11, its highest level since sept 2 2026.
- Fed governor waller signalled a december rate hike, pushing quarter‑point hike odds to about 90%.
- The fed funds rate sits at 3.75‑4.00% versus the bank of japan’s 1.25% policy rate, a gap of roughly 2.5 percentage points.
- Japanese wholesale inflation data due nov 13 and q3 gdp due nov 17 could shape the boJ’s december decision.
The usd/jpy pair slipped below the 160.00 psychological barrier on nov 11, 2026, marking the first time it has approached that level since early september. The move came as fed governor waller hinted a rate hike at the december meeting and as traders await the us producer price index (ppi) for october, due nov 13.
Technical breakout and price action
After seven weeks of trading in a tight 156.00‑159.00 range, usd/jpy surged past the upper band and settled just under 160.00, near the top of wednesday’s range. The breakout erased most of the decline from the sept 2 high of about 160.50, while still leaving a small gap to the previous low of roughly 153.00.
The pair’s momentum is supported by a widening interest‑rate differential: the fed funds target sits at 3.75‑4.00% compared with the bank of japan’s 1.25% policy rate, a spread of at least two and a half percentage points that favours the dollar.
Fundamental drivers behind the rally
October’s us consumer price index surprised to the upside with a 0.4% monthly rise, reinforcing expectations of a tighter monetary stance. Waller’s comment that a december hike is “likely” pushed the market’s odds of a quarter‑point move to roughly 90%.
On the japanese side, boj board member takata voted for a 1.50% rate in the october decision and most analysts expect a similar move at the december 17‑18 meeting. If the boj raises rates by a quarter‑point nine days after a fed hike, the yield gap would narrow, potentially capping further yen weakness.
Read also: UK GDP Q3 growth expected at 0.7% and its impact on GBP/USD
Upcoming data and its impact
Key japanese releases include october corporate goods prices at 23:50 gmt wednesday and q3 gdp at 23:50 gmt sunday. Both feed the boj’s december policy outlook and could add volatility to the pair.
In the us, november 14 jobless claims (forecast 195k) and the ppi for october (expected 0.4% rise) will be released before the weekend. The ppi, in particular, will test whether inflation pressures remain elevated enough to justify a half‑point hike beyond the quarter‑point already priced in.
Historical context and risk outlook
The last two occasions usd/jpy traded above 160.00 – late july and early september – each ended with a five‑yen drop within a week, highlighting the psychological resistance at that round number.
Traders should watch for any verbal warnings from japanese authorities, which could signal imminent market intervention, as well as the direction of the usd/jpy after the upcoming data releases. A break above 160.00 would test the sept 2 high, while a fall back below 156.00 could reopen the previous range.
- Nov 13 2026 – us ppi (october) 0.4% forecast
- Nov 14 2026 – us jobless claims 195k forecast
- Nov 13 2026 – japan corporate goods prices 23:50 gmt
- Nov 17 2026 – japan q3 gdp 23:50 gmt
Frequently asked questions
Why is the usd/jpy pair moving toward 160?
The pair is being pushed higher by a widening interest‑rate gap – the fed funds rate is 3.75‑4.00% while the boj holds a 1.25% policy rate – and by fed governor waller’s hint of a december hike, which raised odds of a quarter‑point move to about 90%.
What data could change the direction of usd/jpy this week?
Key releases are the us producer price index for october (expected 0.4% rise) on nov 13, us jobless claims on nov 14, japan’s october corporate goods prices on nov 13 and japan’s q3 gdp on nov 17. Any surprise in these numbers could shift sentiment.
Official data sources
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This article is compiled from international market news for information only. It is not investment advice.