Yen Strengthens, USD/JPY Under Pressure
USD/JPY weakened to the 154.35 area in early Asian trading on Monday, down around 0.46%. The US dollar lost steam against the yen as markets were again haunted by uncertainty over the direction of US tariff policy.
Sentiment worsened after President Donald Trump responded to the US Supreme Court's ruling invalidating "reciprocal" tariffs with plans to raise global tariffs to 15% from 10%. This move heightened market concerns about the risks of a trade war and its impact on growth, increasing interest in safe-haven assets like the yen.
From Japan, cooler inflation data tempered expectations of an imminent Bank of Japan (BoJ) interest rate hike. Annual CPI in January fell to 1.5% from 2.1% the previous month, while core inflation fell to 2.0% (in line with the BoJ's target). This could limit excessive yen strengthening, potentially limiting the decline in USD/JPY.
Looking ahead, the market is also monitoring the direction of fiscal policy following Prime Minister Sanae Takaichi's victory in the snap election. He stated that necessary spending would be financed as much as possible through the initial budget, while continuing to strive to reduce the debt-to-GDP ratio and maintain fiscal sustainability. (asd)
Source: Newsmaker.id
