Ella 
The Japanese yen (JPY) fell below the psychological 160.00 mark for the first time since April 1990. It rebounded strongly during the session on Monday, rebounding more than 550 points against the US dollar. Traders believed the first intervention by Japanese authorities in 18 months was the trigger for the yen’s strong rebound amid a relative scarcity of liquidity amid a local public holiday. This, coupled with fresh dollar selling, dragged USD/JPY to a one-week low.
However, the yen is starting to lose traction amid expectations that interest rates in Japan will remain low for some time while those in the United States are relatively high. This, coupled with a generally positive tone on risk, tends to reduce the yen’s safe-haven role, helping USD/JPY attract fresh buying around 154.00 and pare some of the heavy intraday losses. The momentum was further boosted by lackluster macro data from Japan during Tuesday’s Asian session.
Meanwhile, the market’s focus remains on the outcome of the key two-day FOMC policy meeting due to be released on Wednesday. Additionally, important U.S. macro data releases this week, including Friday’s closely watched non-farm payrolls (NFP) data, will influence USD trends and provide some meaningful impetus for USD/JPY. Meanwhile, Tuesday’s U.S. economic data, including the Chicago Purchasing Managers Index (PMI) and the Conference Board Consumer Confidence Index, will provide opportunities for short-term trading.
