Japanese Yen Soars as Fed Rate Hike Odds Fall

The Japanese Yen strengthened against the US Dollar on Monday, driven by reduced expectations for another Federal Reserve rate increase. USD/JPY fell for a second session and traded near 159.10 during Asian hours.

Japan's weaker second-quarter growth figures failed to reverse the currency's advance, despite slowing from 0.5% in the previous three months to 0.3%. Economists had expected another 0.5% quarterly increase.

The figures may complicate the Bank of Japan's rate plans, but a Japanese 10-year government bond yield climbed to its highest level in three decades. Market pricing placed the chance of a September BoJ increase near 80%, according to Capital Economics.