Ella 
The yen recovered further against the dollar from two-month lows hit on Monday.
Geopolitical tensions favor the safe-haven Japanese yen and put downward pressure on the USD/JPY pair.
Uncertainty over a rate hike by the Bank of Japan limited the yen’s gains and should limit further losses in major currencies.
The Japanese yen (JPY) led against the US dollar for the second day in a row on Tuesday, despite a lack of bullish confidence. Comments from Japanese officials overnight reignited intervention concerns, which, along with rising geopolitical tensions in the Middle East, became a key factor supporting the safe-haven yen. In addition to this, a slight decline in the US dollar (USD) has exerted some downward pressure on the USD/JPY pair.
Still, the dwindling chances of another rate hike by the Bank of Japan (BoJ) in 2024 are discouraging yen bulls from aggressive bets. Additionally, investors have been reducing expectations for more aggressive policy easing from the Federal Reserve. This in turn helped limit losses in the greenback and the USD/JPY pair ahead of Wednesday’s release of FOMC minutes, followed by U.S. inflation data on Thursday and Friday.
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