USD/JPY aims to extend upside to near 150.00 as Yen weakens across the board

• USD/JPY jumps to near 149.80 as the Japanese Yen weakens on a slight correction in 10-year JGBs.
• The BoJ is expected to raise interest rates further this year.
• The US Dollar bounces back as investors digest weak US PMI data.

The USD/JPY pair advances to near 149.80 in North American trading hours on Monday. The asset gains as the Japanese Yen (JPY) weakens across the board amid a slight correction in 10-year Japan bond yields.

Investors rushed to buy Japanese bonds after Bank of Japan (BoJ) Governor Kazuo Ueda said on Friday that the central bank could ramp up the government bond-purchasing program if long-term interest rates rise sharply. 10-year JGBs decline to near 1.41% from 1.45%, the highest level seen in almost 15 years.

Meanwhile, firm expectations that the BoJ will raise interest rates again this year would keep the Japanese Yen on the front foot. Hotter-than-expected Japan's National Consumer Price Index (CPI) data for January also added to expectations that the BoJ will tighten its monetary policy further.

On the US Dollar (USD) front, a strong recovery has been seen after sliding to its lowest in almost 12 weeks. The US Dollar Index (DXY) rebounded to near 106.60 as investors digest weak United States (US) flash S&P Global Purchasing Managers' Index (PMI) data for February, released on Friday. The Composite PMI fell to 50.4 from 52.7 in January as activities in the services sector declined unexpectedly for the first time after expanding for straight 25 months.

Weak US private business activity data has resulted in a decent increase in Federal Reserve (Fed) dovish bets. The likelihood for the Fed to cut interest rates in the June meeting has increased to 58% from almost 50% a week ago, according to the CME FedWatch tool.