Chart - Courtesy Trading View
USD/JPY was trading just below 131 handle at 130.93 at around 04:45 GMT, poised to test fresh multi-month lows below 130.56.
The pair remains depressed below 131 handle amid Monday’s sluggish session and holiday thinned trades.
Hawkish concerns surrounding the Bank of Japan (BOJ) keep the yen buoyed, weighing on the pair.
BOJ is considering raising its inflation forecasts in January to show price growth close to its 2% target in fiscal 2023 and 2024, reports from Nikkei Asia showed on Friday.
Strong BOJ inflation forecast, along with the latest tweak in the Yield Curve Control (YCC) policy, and the central bank’s multiple market interventions in the last few days keep bearish bias intact.
Downbeat US data last week adds to the USD weakness. Markets largely ignored upbeat Chicago Purchasing Managers’ Index which beat consensus of 41.2 and the 37.2 previous readings to print the 44.9 figures for December.
Looking forward, Wednesday’s FOMC Minutes, as well as Friday’s December month employment numbers for the US, will be crucial for the pair's direction.
Technical indicators have turned bearish for the pair. Immediate support lies at 130.56 (Dec 20th low), break below will see dip till 126 levels.


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