The Japanese Yen holds steady as traders await Wednesday’s US inflation report, which may influence Federal Reserve policy expectations.
The Japanese Yen (JPY) traded flat above 159.00 against the US Dollar (USD) on Tuesday, recovering from recent losses driven by USD strength and elevated oil prices. The pair retraced most of its intervention-induced decline but remains under pressure amid geopolitical tensions in the Middle East.
Markets are focused on Wednesday’s US Consumer Price Index (CPI) report, with July’s inflation expected to ease from June’s levels. The data could shape expectations for Federal Reserve rate cuts later this year. Prior sessions saw the Yen weaken as USD demand persisted despite Japan’s intervention efforts.
Geopolitical risks, including Iran’s demands for US concessions, added to market caution. Traders are monitoring developments in the Strait of Hormuz, though Iran indicated any shipping agreements would remain separate from broader disputes.