No significant events are expected today.

The upbeat market sentiment and rising U.S. Treasury yields are limiting the growth of the low-yielding yen.

The U.S. dollar remains near its highest level in a year, providing support to the USD/JPY pair.

The Japanese yen (JPY) has attracted buyers for the second consecutive day after slightly higher-than-expected consumer inflation data in Japan. This follows Thursday’s remarks from Bank of Japan Governor Kazuo Ueda, which maintain expectations of a potential rate hike in December. Additionally, the 39 trillion yen economic stimulus package from Japanese Prime Minister Shigeru Ishiba is contributing to yen strength and exerting some pressure on the USD/JPY pair.

However, the prevailing risk-on sentiment and rising U.S. Treasury yields are discouraging traders from aggressive bullish bets on the low-yielding yen. Investors remain concerned that U.S. President Donald Trump’s policies could reignite inflation, forcing the Federal Reserve to reduce interest rates slowly. This has been a key driver behind the recent rise in U.S. bond yields, keeping the U.S. dollar (USD) near its yearly high and supporting the USD/JPY pair.

Recommendation: Watch the 154.00 level; trades are primarily in Buy orders.