USD/JPY to Near 98 Before Home Sales, FOMC

The dollar dropped to a one-month low versus the yen before a private report forecast to show sales of previously owned homes fell and the Federal Open Market Committee starts a two-day meeting tomorrow.

The Bloomberg Dollar Index touched the lowest level in five weeks as investors weighed whether the U.S. economy is robust enough for the Fed to start reducing stimulus. The yen was supported as a decline in global stocks boosted demand for haven assets. Bank of Japan Governor Haruhiko Kuroda will speak at the Research Institute of Japan in Tokyo today.

“The U.S. economy doesn’t look as though it’s strong enough for this week’s FOMC statement to be at all hawkish,” said Sean Callow, a senior currency strategist at Westpac Banking Corp. (WBC) in Sydney. “That chips away a bit at the U.S. dollar’s appeal.”


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