The yen fell in Asian trade on Tuesday on track for a loss against the US dollar after a two-day hiatus, while moving towards three-week lows once more, amid intensive US-Japan trade negotiations.

Later this week, an important Federal Reserves policy meeting is expected to provide clues on the path ahead for US interest rates.

The Price

The USD/JPY price rose 0.4% today to 144.27, with a session-low at 143.55.

The yen rose 0.9% on Monday against the dollar away from a three-week low at 145.92.

The yen was boosted by haven demand amid concerns about a US recession this year.

Trade Talks

The US refused to exempt Japan from the reciprocal 10% tariff in addition to the country-specific tariff of 14% according to latest sources.

US Treasury Secretary Scott Bessent told Japanese negotiators the Trump administration might be willing to reduce the company-specific tariff as part of the negotiations.

Japan is seeking to remove the reciprocal tariffs completely, in addition to 25% tariffs on auto products, steel and aluminum.

Japan is one of the first countries that sought quick negotiations with the US on the tariff crisis.

The Fed

Today, the Federal Reserve will convene and discuss monetary policies, expected to hold interest rates unchanged.

The Feds monetary statement and Chair Powells subsequent press conference will likely provide clues on the path ahead for policies.

US President Donald Trump continued to pressure Powell to cut interest rates, however he said wont fire him before the end of term in May 2026.

According to the Fedwatch tool, the odds of a Fed 0.25% rate cut in May stood at just 8%.

The odds of such a cut in June stood at a healthier 65%.

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