Yen Surges to Seven-Month High as Dollar Falls Ahead of Inflation Data

The US dollar fell against major currencies on Monday due to a US public holiday, while the yen surged to a seven-month high as investors reassessed their outlook for Japan's currency.

The yen rose 1.1% against the dollar to 154.42 yen, its lowest level since February, surpassing lows reached in August after Washington and Tokyo intervened to support the yen.

The Japanese currency gained over 2% last week due to factors such as the unwinding of carry trades and expectations for capital repatriation, which would provide further support for the yen.

The main event this week is Friday's US inflation data, which will influence the Federal Reserve's decision on interest rates and determine the dollar's direction.