How much further can the dollar run before Tokyo spends again? Finance Minister Satsuki Katayama gave the market her answer on Friday, per Reuters, warning that her government would act if currency moves turned disorderly, with the yen sitting a fraction below 160 per dollar. Her warning closed a week in which the dollar index finished at 103.41, its highest since April 2025. The euro ended at $1.1023, its lowest since April 2025, and the yen closed at 159.78.
The move was a repricing of the Federal Reserve's path, not a single headline. Two-year Treasury yields rose 34 basis points across the week to about 4.87%, their largest weekly jump since April 2025, per Reuters. The 10-year yield closed the week at 5.13%, up 0.27 points, its steepest weekly rise since April 2025. Marc Chandler of Bannockburn Global Forex told Reuters the dollar stayed firm on the back of the jobs report and accelerating CPI.
The week, day by day
Tuesday, November 10: the CPI print
October consumer prices rose 0.4% on the month against 0.3% expected, and core prices rose 0.3% for a third straight month, per the Bureau of Labor Statistics. Deutsche Bank analysts noted, per FXStreet, that the three months together put core CPI on a 3.75% annualised pace. Gold fell 2.67% to $4,030.80 on the day and bitcoin dropped to $73,356, per the MarketRadar macro file. Fed Governor Christopher Waller opened the door the same day to a 50-basis-point December hike.
Wednesday, November 11: the 19-month high
The dollar index pushed to 102.90, its highest since April 2025, per Reuters. Goldman Sachs told clients it expects another hike early next year, on top of December. The euro slipped to $1.11, and the yen moved into the 159s for the first time since late September.
Thursday, November 12: the yen touches 160
USD/JPY traded through 160.04 during Thursday's session, per Finnhub daily candles, the first touch of the line since early September. The pair fell back within minutes as verbal warnings from Tokyo piled up. Atsushi Mimura, the finance ministry's top currency official, called the moves too rapid, per FXStreet. Japan's wholesale prices rose 7.1% from a year earlier in October, against 6.5% expected, per Reuters, a reading that keeps Bank of Japan hike bets alive for December.
Friday, November 13: PPI and the close
October producer prices rose 0.3% on the month, below the 0.4% consensus, with the annual rate at 6.5% against 6.6% expected; core rose 0.3% on the month and 5.0% on the year, both in line, per FXStreet. The index added 0.23% in late New York trading to close at 103.412, per Xinhua, with the euro at $1.1023, sterling at $1.3210. The yen finished at 159.78 after an intraday high of 160.19. Bitcoin lost 4.22% on Friday, ending at $68,467.26, and ether lost 4.02% to $1,934.86, per Reuters.
How the week repriced the Fed
The Federal Reserve raised its benchmark 25 basis points to 3.75%-4% on September 16, then held there on October 28 in a 10-2 vote, with two dissents in favour of a hike. Two hot October inflation prints, CPI at 3.7% year on year and PPI at 6.3%, had already put a December move back on the table. This week turned one hike into a debate about a sequence.
A 25-basis-point December hike is fully priced (as of November 11), and traders price a 14.5% chance of a 50-basis-point move (as of November 13), per Reuters and the CME FedWatch tool. FXStreet's Friday reading of the same tool put a second hike in January at 65.5% and a third in March near 50%, against 6% a week earlier (as of November 13). TD Securities now expects a quarter-point hike in each of December, January and March. ING strategist Chris Turner said short-dated US yields were "close to 40bp higher" than Tuesday morning, per FXStreet, when Waller first floated the half-point option. Williams and Logan added hawkish comments through the week, per Reuters.
The yen at 160: what Tokyo has done before
The 160 line carries weight because Tokyo has defended it with real money. Ministry of Finance figures released on November 9 show the government sold dollars and bought yen worth 7,975.6 billion yen on July 30, the largest single-day intervention on record. Total yen buying in late July reached about 15.4 trillion yen, roughly $96.5 billion, after the pair hit 163.99, a four-decade low.
The Bank of Japan holds its policy rate at 1.25% after a September hike. A December hike from Tokyo would narrow the rate gap pulling the yen down, and the 7.1% wholesale print gives the board's hawks a case. For now the market is testing whether words alone hold the line, or whether a close above 160 forces the ministry to spend again.
The week in numbers
| Pair | Nov 6 close | Nov 13 close | Week change |
|---|---|---|---|
| Dollar index (DXY) | 102.26 | 103.41 | +1.15 points (+1.1%) |
| EUR/USD | 1.1144 | 1.1023 | -121 pips (-1.1%) |
| GBP/USD | 1.3355 | 1.3210 | -145 pips (-1.1%) |
| USD/JPY | 158.43 | 159.78 | +135 pips (+0.9%) |
November 6 closes are the October jobs-report reaction; November 13 closes are Xinhua's late New York figures.
Bitcoin traded at $64,313 in the MarketRadar snapshot at 21:16 UTC on Saturday, 6.1% below its Friday close, and ether stood at $1,766, 8.7% below its Friday close. Gold held near $3,888. The dollar's week is spilling into risk assets.
What to watch
- US retail sales land Tuesday, November 17 (consensus: +0.2% for October).
- Federal Open Market Committee minutes arrive Wednesday, November 18, the first read on the October hold debate.
- Whether USD/JPY closes above 160, and whether Tokyo answers with yen purchases, as in July.
- The December 8-9 Fed meeting, with a 25-basis-point hike fully priced and the 50-basis-point chance at 14.5% (as of November 13).
- November CPI lands December 10, one day after the December meeting.
Key points
- The dollar index closed Friday at 103.41, its highest since April 2025, for its best week in two months and a third straight weekly gain.
- Two-year yields rose 34 basis points on the week to about 4.87%; the 10-year closed at 5.13%, up 0.27 points.
- USD/JPY touched 160.19 on Friday and closed at 159.78, with Finance Minister Katayama warning Tokyo would respond to volatility.
- A 25-basis-point December hike is fully priced (as of November 11); the 50-basis-point chance stands at 14.5% (as of November 13).
- Bitcoin slid to $64,313 by Saturday evening, 6.1% below its Friday close.
MarketRadar take
The dollar's bias stays with the rally while the index holds above 103.00, the level that capped it earlier in the week. FXStreet's chart read puts the next resistance at 104.00, then 104.71, the late March 2025 top, with the daily RSI near 64. A return below 103.00 would open 102.00. For the yen, the trade is binary around 160: a close above it tests whether Tokyo spends a third time this year.
