Japanese Yen extends its intraday descent against USD, seems vulnerable

• The Japanese Yen weakened after the BoJ summary showed that policymakers were divided on rate hike timing. 
• Japan’s Prime Minister Ishiba faces a leadership vote, adding another layer of uncertainty and undermining the JPY.
• The Trump optimism continues to underpin the USD and further contributes to the USD/JPY pair’s move up. 

The Japanese Yen (JPY) kicks off the new week on a weaker note and for now, seems to have snapped a two-day winning streak against its American counterpart amid the uncertainty over the Bank of Japan’s (BoJ) rate-hike pans. In fact, the BoJ Summary of Opinions from the October meeting showed that policymakers were divided on rate hike timing. Adding to this, the domestic political landscape could make it difficult for the BoJ to tighten its monetary policy further, which, along with a positive risk tone, undermines the safe-haven JPY. 

Furthermore, fears that US President-elect Donald Trump might again target Japan with protectionist trade measures turn out to be another factor weighing on the JPY. That said, the recent verbal intervention by Japanese authorities might hold back the JPY bears from placing aggressive bets and cap the USD/JPY pair amid subdued US Dollar (USD) price action. Investors might also prefer to move to the sidelines ahead of this week’s key US macro releases, including the latest consumer inflation figures, and Fed Chair Jerome Powell’s scheduled speech.