USD/JPY bounces off 4-month high

US dollar fluctuated lower in a tight range during the Asian session to bounce for the third session from its highest since December 20 against the Japanese Yen, following developments and economic data released by the Japanese economy, and on the threshold of developments and economic data release expected on Tuesday, by the US economy, the world's largest economy.

As of 05:45 GMT, USD/JPY dropped 0.03% to 111.91 compared to the opening levels at 111.94 after the pair reached the lowest since April 12th at 111.65 and a high of 111.85.

We followed the Japanese economy as it released the inflation data with the core CPI reading, which showed growth acceleration to 0.5% in line with expectations versus 0.4% in February, this comes hours before the BoJ meeting on Thursday, in which the central bank's monetary policy makers may maintain zero interest rates and move forward with stimulus policies.

On the other hand, markets are looking for the release of the US Housing Price Index, which may reflect a stable 0.4% growth, unchanged from January, while the new home sales index may drop 3.0% to 647,000 versus 4.9% at 667,000 in February, in conjunction with the Chicago PMI reading, which may show a 10-month widening stability.