Japanese Yen trims part of intraday gains, pushing USD/JPY back above 154.00

• The Japanese Yen struggles to capitalize on modest intraday gains amid the BoJ rate-hike uncertainty. 
• The risk-on mood further undermines the safe-haven JPY and lifts USD/JPY above the 154.00 mark.
• Retreating US bond yields prompts some USD profit-taking and could support the lower-yielding JPY.

The Japanese Yen (JPY) trims a part of its Asian session gains against the Greenback amid the uncertainty tied to the Bank of Japan’s (BoJ) rate-hike plans. Apart from this, the prevalent risk-on environment undermines demand for the safe-haven JPY. Furthermore, expectations that US President-elect Donald Trump’s policies could reignite inflation and restrict the Federal Reserve (Fed) to cut interest rates slowly act as a tailwind for the US Dollar (USD). This, in turn, assists the USD/JPY pair to rebound over 50 pips from the daily low and climb back above the 154.00 mark in the last hour. 

Meanwhile, Scott Bessent’s nomination as US Treasury Secretary offers some respite to bond investors and triggers a sharp fall in the US Treasury bond yields. This, in turn, could offer some support to the lower-yielding JPY and cap gains for the USD/JPY pair. Traders might also opt to wait for the release of the November FOMC meeting minutes, the first revision of the US Q3 GDP and the US Personal Consumption and Expenditure (PCE) Price Index data later this week. This, in turn, warrants some caution before placing directional bets in the absence of any relevant US macro data.