The Japanese yen declined in the Asian market on Tuesday against a basket of major and minor currencies, deepening its losses for the fourth consecutive day against the US dollar and recording its lowest level in two weeks, as the US currency continued to shine following recent trade developments and ahead of the Federal Reserve meeting.

The Bank of Japan is scheduled to meet on Wednesday to discuss monetary policy appropriate to recent economic developments in the country, with the probability of a 25 basis point interest rate hike remaining below 20%.

The Price

USD/JPY exchange rate today: the dollar rose against the yen by 0.15% to 148.71 the highest since July 18 up from today's opening price of 148.50, with a low of 148.29.

The yen lost 0.6% against the dollar by Mondays close, marking its third consecutive daily loss, amid improved risk appetite in markets.

US Dollar

The US Dollar Index rose by about 0.1% on Tuesday, extending its gains for the fourth consecutive session and reaching a two-week high at 98.71 points, reflecting continued strength in the US currency against a basket of major and minor currencies.

This rise comes as fears of a US economic slowdown eased following recent trade agreements signed by the United States with Japan and the European Union.

In addition, strong economic data pointed to the possibility that the Federal Reserve may take longer before resuming US interest rate cuts.

Later today, the highly anticipated Federal Reserve monetary policy meeting will commence, with decisions expected on Wednesday. Forecasts indicate that US interest rates will likely remain unchanged for the fifth consecutive meeting.

Bank of Japan

The Bank of Japan will meet on Wednesday to discuss monetary policy suitable to developments in the worlds fourth-largest economy, with decisions expected on Thursday.

Market pricing for a 25 basis point rate hike by the Bank of Japan in this meeting currently holds steady at around 20%.

Bank of Japan Governor Kazuo Ueda previously stated that the economy and prices are facing strong downward pressures, and that the Bank of Japan has limited room to support growth by cutting interest rates, with the short-term interest rate remaining at 0.5%.

Former Bank of Japan Deputy Governor Hiroshi Nakaso said it is likely the Bank will resume interest rate hikes once uncertainty over the impact of US tariffs on the economy recedes.