The dollar is mixed against the world's major currencies on Tuesday, as traders are cautious ahead of a key US inflation report and the Bank of Japan's interest rate decision.
The USD/JPY was down 0.04% at 154.78.
Japan's finance minister said on Tuesday that a meeting last week with his US and South Korean counterparts laid the groundwork for Tokyo to take action against excessive yen movement, Reuters reported.
At the same time, traders believe that if the USD/JPY reaches the 155 level, it will be a reason for the Japanese authorities to intervene.
It is worth noting that lower tensions between Iran and Israel are limiting the yen's recovery.
Carol Kong from the Commonwealth Bank of Australia believes that the USD/JPY will remain at elevated levels in the near future due to the overall strength of the dollar.
The US Dollar Index (DXY), which tracks the greenback against a basket of global currencies, fell 0.24% to 105.89.
FedWatch CME data showed that markets are now pricing in a 46% rate cut by the Federal Reserve in September.
Analysts at the Commonwealth Bank of Australia said that if this week's GDP and/or PCE figures add to fears of a slowdown in deflation, markets could further push back the timing of the expected first rate cut.
EUR/USD and GBP/USD fell 0.07% and 0.06% to 1.0648 and 1.2341, respectively, amid expectations that the European Central Bank and the Bank of England will begin cutting interest rates by mid-year.
AUD/USD remains steady at 0.6450 on improved risk sentiment amid easing tensions in the Middle East.
Meanwhile, NZD/USD is down 0.17% to 0.5909 on hawkish sentiment surrounding the Federal Reserve's June rate forecast.
Read also: Latest forecasts point to BTC rising by year-end