USD/JPY consolidates around 147.50, awaiting US CPI data  

• The US Dollar trades without a clear bias against the Yen, fluctuating around 147.50 on Monday.
• Investors await the US CPI data on Tuesday to put directional bets on the US Dollar.
• The yen remains on its back foot amid the uncertainty about the BoJ's monetary policy.
  

The US Dollar is trading within a tight range on both sides of the 147.50 level against the Japanese Yen on Monday, with traders wary of placing directional US Dollar bets ahead of Tuesday's US Consumer Prices Index report.

Recent US employment data has prompted investors to ramp up bets of the Federal Reserve easing in September, and the market will be looking at Tuesday's consumer inflation figures to confirm those bets.

July's CPI, however, is expected to show that the impact of tariffs is starting to boost price pressures higher. The headline CPI is seen accelerating to a 2.8% year-on-year reading, from 2.7% in June and 2.4% in May, while the core inflation is expected to have returned to the 3% yearly rate, from 2.9% in the previous month.

Investors remain wary of higher-than-expected inflation. This would pose a serious challenge to the Federal Reserve's policymakers in the context of a labour market slowdown.

The Japanese Yen, on the other hand, remains vulnerable as the BoJ Summary of Opinions underscored the uncertainty surrounding the bank's policy and cast doubt over the possibility of further rate hikes in the near term.

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