The USD/JPY pair climbed to an Asia session high of 106.84 and is currently settling back to the 106.70 region as risk sentiment sours in the face of the impending US CPI data coupled with the political scandal in the Japanese parliament taking the top off the Yen ahead of the European market session.
The US CPI data that drops on markets at 12:30 GMT today could stoke renewed inflation fears after the jobs report on Friday cooled inflation expectations with lagging wage growth crimping potential for runaway growth. The headline year-on-year CPI figure is forecast to come in at 2.2% versus the previous 2.1% and a beat for the number could spark a fresh 'risk-run' in markets, sending the US Dollar higher.
The Japanese markets are bogged down amidst the parliamentary scandal that sees the Prime Minister, Shinzo Abe, and Finance Minister Taro Aso embattled within their positions in the Japanese government following revelations that Aso had a hand in forged documents involved in the sale of government land to a school operator with ties to Premier Abe's wife.
Source : FX Street