The Japanese yen is moving into negative territory due to interest rate differentials.

The Japanese yen fell in the Asian market on Tuesday against a basket of major and minor currencies, continuing its losses for the third consecutive day against the U.S. dollar, on its way toward touching its lowest levels in two weeks, due to concerns about widening interest‑rate differentials between Japan and the United States.

• According to the “Fed Watch” tool of the CME Group: the probability that the Federal Reserve will keep interest rates unchanged at its October meeting is currently priced at 45%, and the probability of a rate hike of about 25 basis points is priced at 55%.

The interest‑rate differential between Japan and the United States is currently at 275 basis points in favor of U.S. rates, which supports the rise of the U.S. dollar against the yen. In light of the above probabilities, the differential is expected to widen to 300 basis points in October.

Japanese authorities reported in the Nikkei newspaper that Japanese officials carried out “exchange‑rate checks” in the country. The process involves authorities asking banks to provide currency rates to gauge market conditions, a measure traders view as a precursor to potential intervention in the currency market.

The Nasdaq index jumped to a new record close on Monday, supported by gains in Advanced Micro Devices (AMD) shares and other large AI‑related stocks, while Treasury yields fell from their recent highs, and crude oil prices dropped to their lowest level in 11 days amid speculation that a breakthrough in Middle East talks could be achieved at a UN meeting this week.

Ripple (XRP) maintains a strong bullish stance, rising to trade near $1.50 on Monday. The crypto transfer token recorded four consecutive days of gains, supported by strong momentum indicators and increased risk appetite in the broader crypto market.