Ella 
The yen remained stable against the U.S. dollar following the release of July U.S. personal consumption expenditures (PCE) index data, which led traders to lower expectations for an aggressive interest rate cut by the Federal Reserve in September.
Markets fully expect the Fed to cut interest rates by at least 25 basis points at its September meeting, according to the CME FedWatch tool. Traders are now likely to look to upcoming U.S. employment data, including non-farm payrolls (NFP) for August, for further insight into the potential size and pace of rate cuts from the Federal Reserve.
On Monday, Japanese companies reported a 7.4% rise in second-quarter capital spending. Additionally, Japan’s August manufacturing PMI was revised up to 49.8 from 49.5, indicating a stabilizing trend. Rising inflation in Tokyo strengthened the Bank of Japan’s (BoJ) hawkish monetary policy stance on Friday, boosting the yen and capping gains in the USD/JPY pair.
