• The Japanese Yen edges higher against the USD, though it lacks bullish conviction. 
• The uncertainty over the BoJ’s rate-hike plan and a positive risk tone caps the JPY. 
• Bets for smaller Fed rate cuts could underpin the USD and limit losses for USD/JPY.

The Japanese Yen (JPY) ticks higher against its American counterpart during the Asian session on Thursday and reverses a part of the overnight losses back closer to the lowest level since early August. Any meaningful JPY appreciation, however, still seems elusive amid the uncertainty over the Bank of Japan's (BoJ) rate-hike path. A fall in Japan's exports for the first time in 10 months raised concerns about weakness in global demand. This comes on top of a surprise opposition to further rate hikes from Japan's Prime Minister Shigeru Ishiba and may complicate the BoJ's plans to exit years of ultra-easy monetary policy.

Apart from this, the prevalent risk-on environment might contribute to capping the upside for the safe-haven JPY. Furthermore, expectations that the Federal Reserve (Fed) will proceed with modest interest rate cuts over the next year continue to act as a tailwind for the US Treasury bond yields and keep the US Dollar (USD) well supported near its highest level in more than two months. This could further undermine the low-yielding JPY and support prospects for the emergence of some dip-buying around the USD/JPY pair. Traders now look forward to the US macro releases for short-term impetus later this Thursday.