https://t.co/hWOXnKphtd Understand in 5 Minutes! Morning FX News (October 19, 2026) SBI Securities Official Channel #AISummary October 19: FX Market Trends and This Week’s USD/JPY and EUR/USD Outlook 🔳 USD/JPY Outlook for This Week With the FOMC meeting scheduled for the 27th–28th and the Bank of Japan’s monetary policy meeting on the 29th approaching, both the U.S. and Japan are expected to hold interest rates steady. USD/JPY is anticipated to trade around 158 yen, exploring direction within the range of 157.50 to 158.50. 🔳 Factors Constraining USD/JPY Upside Federal Reserve officials have signaled caution toward early rate hikes, while declining U.S. long-term yields are capping USD/JPY’s upside. The 200-day moving average at 158.58 is being watched as key resistance. 🔳 Factors Supporting USD/JPY Downside Tensions in the Middle East and attacks on Russian energy infrastructure have raised concerns over crude oil supply, exerting downward pressure on the yen. WTI crude oil futures ended last week near $101. Additionally, concerns over funding for consumption tax cuts and fiscal expansion may limit yen appreciation. 🔳 Watch Japan’s Consumer Price Index Japan’s September national CPI, to be released on the 23rd, is expected to come in higher than forecast. Depending on the outcome, expectations for further BOJ rate hikes could intensify, potentially pushing USD/JPY down toward the 156 yen level. 🔳 USD/JPY Last Week’s Close In Tokyo trading, USD/JPY rose to 158.18 before retracing to 157.80. It rebounded to 158.09 in European trading but fell to 157.70 amid declining U.S. long-term yields. The pair recovered slightly to 158.34 before closing at 158.00. 🔳 EUR/USD Outlook for This Week France’s fiscal deterioration, political uncertainty, and the Ukraine situation weigh on the euro. The daily pivot line at 1.1195 serves as key support; resistance is seen at 1.1277 and 1.1300. A break below 1.1195 could trigger renewed euro selling. 🔳 European Economic Data and ECB Policy Ahead of the ECB council meeting on the 28th–29th, attention turns to Germany’s ZEW Economic Sentiment Index on the 20th and Germany/Eurozone manufacturing and services PMIs on the 23rd. Weak data could dampen rate hike expectations and reignite euro selling pressure. 🔳 EUR/USD Last Week’s Close In Tokyo trading, EUR/USD fell to 1.1208 before rising to 1.1269 in European trading, supported by declining U.S. long-term yields. However, it stalled near last week’s high of 1.1277 and retreated to 1.1213 in New York trading, closing at 1.1239. 🔳 U.S. Stock Market and AI-Related Stock Declines Last week, the Nasdaq closed at 26,140.03, down 572.99 points (-2.14%), with a weekly decline of approximately 4.5%. Concerns over massive investments and debt burdens by AI-related firms intensified, causing CoreWeave shares to drop around 12%. The Dow Jones also fell by 175.28 points. 🔳 Impact of U.S. Long-Term Yields on Stock Markets Amid AI stock declines, capital flowed into U.S. Treasuries as a safe haven, pushing down long-term yields. The U.S. 10-year yield fluctuated between 5.06% and 5.12%. This week, focus will be on whether the Nasdaq rebounds and whether U.S. long-term yields rise again—both of which will influence USD/JPY and EUR/USD. 🔳 Key Economic Indicators This Week October 19: China GDP and retail sales, Canada CPI, U.S. NAHB Housing Market Index October 20: Germany ZEW Index, U.S. housing data October 21: Japan trade balance, UK CPI October 22: Turkey Central Bank policy decision October 23: Japan CPI, UK retail sales, Germany/Eurozone/U.S. PMIs 🔳 Key USD/JPY Levels Today With the upcoming U.S. and Japanese monetary policy decisions, market participants are adopting a wait-and-see stance; price action is expected to center around the mid-157s to mid-158s. Continued declines in U.S. long-term yields and Nasdaq trends will be critical factors for judgment. 🔳 Key EUR/USD Levels Today If EUR/USD holds above 1.1195, a move toward 1.1269–1.1277 becomes possible. However, if it breaks below 1.1195 amid concerns over France’s fiscal situation and Ukraine tensions, euro depreciation could accelerate. 🔳 Spillover Effects on Japanese Stocks and FX Markets Following the sharp decline in U.S. AI-related stocks, the Nikkei Average is expected to fall, particularly in semiconductor-linked shares. Market attention will focus on how deeply U.S. equity corrections will impact Japanese stocks and currency markets.