USD/JPY gathers strength above 152.00 amid de-escalation trade tensions

• USD/JPY rises to near 152.30 in Tuesday's early Asian session.
• Fed's Paulson expected more rate cuts to support the job market. 
• Japan's political uncertainty undermines the JPY.

The USD/JPY pair attracts some buyers to around 152.30 during the early Asian session on Tuesday. The US Dollar (USD) strengthens against the Japanese Yen (JPY) after a change in rhetoric from US President Donald Trump on China. Traders await the Federal Reserve's (Fed) Chair Jerome Powell speech later on Tuesday. 

Trump on Friday had threatened 100% tariffs on China from November 1. However, he softened his tone on Sunday, saying, "Don't worry about China, it will all be fine!" US Treasury Secretary Scott Bessent said on Monday that Trump remains on track to meet Chinese leader Xi Jinping in South Korea in late October as the two sides try to de-escalate tensions over tariff threats and export controls. Easing trade tensions between the world's two largest economies provides some support to the Greenback against the JPY. 

Dovish remarks from Philadelphia Fed new President Anna Paulson might cap the upside for the pair. Paulson said on Monday that rising risks to the job market argue for more interest rate cuts by the US central bank, as trade tariffs now appear unlikely to push up inflation as much as expected. 

Traders continue to assess the path ahead for Japan's new Liberal Democratic Party leader, Sanae Takaichi, after Komeito quit the ruling coalition on Friday. The political uncertainty in Japan and the expectation that the Bank of Japan (BoJ) might delay a rate hike could undermine the JPY and act as a tailwind for the pair in the near term. Last week, Etsuro Honda, a close economic adviser to Sanae Takaichi, said that the BoJ should be cautious about raising interest rates again, as the economy is still fragile.