The Japanese yen briefly touched its lowest level since early February before recovering slightly in Tuesday morning's Asian trading session. This slight recovery occurred without strong buying momentum, but was helped by comments from Japanese Finance Minister Satsuki Katayama, who signaled intervention to curb the yen's weakening. Furthermore, the risk-off market sentiment has restored support for the yen as a safe haven asset. Meanwhile, weakening demand for the US dollar has pushed the USD/JPY pair back below 155.00.

On the domestic policy front, market vigilance has been renewed following reports that Japanese Prime Minister Sanae Takaichi plans to introduce tax cuts to stimulate consumption. While this plan appears positive for the public, it has raised concerns about Japan's long-term fiscal condition. These concerns were further heightened by the release of third-quarter GDP data, which showed weakening Japanese economic growth. This situation could lead the Bank of Japan (BoJ) to delay an interest rate hike, which could ultimately limit the potential for yen appreciation.

Meanwhile, conditions in the United States have also influenced USD/JPY movements. Expectations that the Federal Reserve will not be overly dovish support the US dollar's strength in the short term, although the dollar currently shows no signs of further buying. Market participants are now awaiting two important events: the FOMC Minutes and the delayed US Nonfarm Payrolls (NFP) report. Both data are expected to provide new direction for the USD/JPY pair and determine whether the yen's recovery can continue or fall back under pressure. (az)

Source: Newsmaker.id