USD/JPY trading on September 8 will center on whether yen-buying momentum continues as U.S. markets reopen after the Labor Day holiday. The pair briefly fell into the lower 154 range in the previous session, while traders assess U.S. long-term yields and the policy outlooks of the Bank of Japan and Federal Reserve ahead of next week’s monetary policy announcements. Japan’s revised second-quarter GDP is expected to show 0.4% quarter-on-quarter growth and 1.6% annualized growth, with nominal GDP forecast to rise 1.3%. Balance-of-payments trade balance and current account figures are also due. The United States will hold a $58 billion, three-year Treasury note auction, which markets will use to gauge the direction of U.S. interest rates. The 10-year Treasury yield recently climbed to the 4.78% range after August nonfarm payrolls rose by 162,000, above the 55,000 consensus, although dollar gains against the yen remained limited. Expectations for a September rate hike rose from about 50% to around 60%, while Cleveland Fed President Hammack said inflation was too high. President Trump renewed pressure for rate cuts and threatened trade restrictions against countries running trade deficits, though market observers questioned the practical and legal implications. The August CPI report on September 11 is viewed as the key remaining test for the Federal Reserve’s next decision. A Nikkei report described the weak yen as being at a turning point and cited possible Bank of Japan rate hikes, increased GPIF bond purchases, lower U.S. rate-hike expectations and reduced carry trades, but some participants considered the argument dependent on all four factors aligning. Other risks this week include the European Central Bank decision, U.S. inflation and labor data, bond auctions, Middle East tensions and crude oil prices. Consensus centers on a USD/JPY range from the upper 155s to the lower 156s.