The USD/JPY pair revisited 154.40 during the European trading session on Tuesday, marking the highest level seen in almost nine months. The currency pair demonstrated notable strength as the Japanese Yen (JPY) faced selling pressure amid receding hopes of additional interest rate hikes by the Bank of Japan (BoJ) in the near term.

On Monday, Japan’s economic adviser to Prime Minister Sanae Takaichi, Takuji Aida, warned that it would be “risky” for the BoJ to raise interest rates in December. Aida further added, “It would be more feasible for the BoJ to raise rates in January, if it can foresee the economy achieving solid growth in fiscal 2026.”

The diminishing expectations for further BoJ rate hikes have weighed heavily on the Japanese Yen. Market participants have been skeptical about the BoJ tightening monetary policy further ever since Sanae Takaichi assumed office as Japan’s Prime Minister. She is widely viewed as following former PM Shinzo Abe’s economic principles, which favored higher public spending.

Looking ahead, investors will turn their attention to the upcoming Producer Price Index (PPI) data for October, scheduled for release on Friday. This data is expected to provide insights into inflationary pressures in Japan’s economy.

Meanwhile, the US Dollar (USD) traded marginally lower, with the US Dollar Index (DXY) ticking down to near 99.55 during the European session. The USD Index remained broadly sideways following the approval of the government funding bill in the United States Senate, which has now moved on to the House of Representatives for consideration.

Going forward, investors will focus on a range of US economic releases that had been delayed due to the recent government shutdown. These upcoming reports will play a crucial role in shaping market expectations regarding the Federal Reserve’s monetary policy outlook.
https://bitcoinethereumnews.com/finance/usd-jpy-revisits-almost-nine-month-high-near-154-50-as-japanese-yen-underperforms/