The yen rose in Asian trade on Tuesday against a basket of major rivals, expanding the gains for a second session against the dollar and hitting five-week high following bullish remarks from government officials, which boosted the odds of a BOJ rate hike later this week.

The gains are also boosted by a drop in US 10-year treasury yields as investors await more clarity on US President Donald Trump’s policies after his official swearing in. 

The Price

The USD/JPY pair fell 0.55% to 154.77 yen per dollar, the lowest since December 19, with a session-high at 156.23.

The yen rose 0.4% yesterday against the dollar, the third profit in four days ahead of the Bank of Japan’s decisive policy meeting this month.

Aggressive Remarks 

Japan’s chief currency diplomat Atsushi Mimura said the government is monitoring price speculation on a daily basis, and he warned of disorganized and undesirable currency movement. 

He said the government and the central bank are in constant contact through various channels to coordinate information and policies. 

He believes that a weaker yen would boost inflation through raising import prices, which would change monetary policy considerations. 

Japanese Rates

Sources told Reuters the Bank of Japan will likely raise interest rates on Friday until a shock occurs in the market due to Trump.

The odds of a 0.25% BOJ interest rate hike in January stand at 90%.

US Yields

US 10-year treasury yields fell 2% on Tuesday to a three-week trough at 4.532%, hurting the dollar’s standing.

Now investors await more clarity on the policies of US President Donald Trump after his official inauguration yesterday.

A recent series of weak US data boosted the odds of a Fed 0.25% rate cut in March, with two more rate cuts expected this year.

Oil prices fell on Monday as the world follows the event of Donald Trump’s inauguration in Washington DC, while the Middle Eastern tensions calmed down.

It comes as Hamas and Israel reach a ceasefire agreement that led to the exchanges of prisoners and hostages. 

Oil futures marked a 1.3% profit last week as the US intensified its sanctions on Russian energy exports.

Following Trump’s inauguration, he is expected to issue a series of orders, including a removal of the temporary ban on exports of liquified natural gas. 

On trading, Brent March futures fell 1.2%, or 98 cents to $79.82 a barrel as of 16:48 GMT. 

Wall Street was closed today for the Martin Luther King holiday and will resume operations tomorrow.

Wall Street closed Friday with weekly gains, with Dow Jones, S&P 500, and NASDAQ rising 3.7%, 2.9%, and 2.4% respectively. 

All eyes are now focused on Donald Trump’s inauguration ceremony later today in Washington DC. 

International benchmark Brent dropped in American trade on Monday to a two-week trough, expanding the losses for the third straight session and moving away from a six-month high on profit-taking.

Investors are shunning big positions before Trump’s inauguration today, with his speech expected to cast light on the priorities of his new administration, with a particular focus on tariffs. 

Prices 

Brent slid 1.4% to $79.47 a barrel, the lowest since January 10, with a session-high at $80.90.

Brent closed down 0.65% on Friday on profit-taking away from a six-month high at $82.56.

Global oil prices rallied 1.25% last week, marking the fourth weekly profit in a row as the US intensified sanctions on the Russian energy sector. 

Trump’s Inauguration 

US President-elect Donald Trump will make his speech and be officially sworn in as President later today, with Trump likely to delineate his main policy goals, with a focus on the economy, internal and international policies. 

Trump is also expected to focus on his tariff plans, aimed at protecting US industries, which would sharpen trade tensions with international allies.