• USD/JPY extends gains for the second successive session.
• The Japanese Yen weakens on market apprehension regarding BoJ’s rate hikes
• An eased US Inflation data could strengthen sentiment of Fed rate cuts.

USD/JPY continues its upward trajectory, nearing 149.50 during Tuesday's Asian trading session. The Japanese Yen (JPY) weakens against the US Dollar (USD) amid market apprehension regarding rate hikes following the Bank of Japan's (BoJ) departure from its ultra-dovish monetary policy stance.

BoJ Deputy Governor Shinichi Uchida's recent statements indicate a reluctance to pursue aggressive tightening, even after the abandonment of negative interest rates. However, the Japanese Yen could be benefiting from its safe-haven status amid heightened tensions between Israel and Gaza.

The US Dollar Index (DXY) sustains its upward trend for the second consecutive session, hovering around 104.20. However, the Greenback's advance may be tempered by subdued US Treasury yields, with the 2-year and 10-year US yields at 4.47% and 4.18%, respectively, at present.

USD/JPY pair advances as traders exercise caution ahead of the release of United States (US) inflation data slated for Tuesday. In Japan, attention will turn to Gross Domestic Product (GDP) data scheduled for release on Thursday.

US Consumer Price Index (CPI) is expected to moderate, with a year-on-year increase of 2.9%, down from the previous rise of 3.4%. The monthly rate is forecasted to remain unchanged at 0.2%. While the preliminary Japan’s Gross Domestic Product (Q4) is expected to increase by 0.3% against the previous decline of 0.7%.