• USD/JPY consolidates in the middle of the week in the initial Asian session.
• Lower US Treasury yields undermine the demand for the US dollar.
• Major issues remain unresolved as Democrats seek a deal on spending.

USD/JPY continue to move higher following the previous two session’s upside movement. The pair stayed in a narrow trading range. At the time of writing USD/JPY is trading at 114.15, up 0.02% so far.

The US benchmark 10-year T bond yields trades lower at 1.61% which undemins the demand for the greenback. Investors digested the November Fed’s tapering with a less hawkish view on interest rate hikes. 

The greenback remains steady near 93.70 as the market awaits updates from upcoming central bank meetings.

On the other hand, the Japanese yen lost the ground, follwoing the Bank of Japan (BoJ) policy preview. The BoJ is expected to maintain its massive stimulus program and cut this year’s inflation forecasts at its meeting on Thursday.

It is worth noting that, S&P 500 Futures are trading at 4,566,up 0.03% so far. 

As for now traders are waiting for the US Durable Goods Orders, and Goods Trade Balance to gauge the market sentiment.

USD/JPY additional levels