USD/JPY tumbled yesterday to a 1-month low following the pessimistic American economic outlook painted by the U.S Federal Reserve yesterday. The pair was at one point trading as low as 89.25, dropping over 100 pips in 24 hours. The greenback was able to stage a mild recovery, moving up to its current level of around 89.55. The yen was also able to make some significant gains against the British pound yesterday, as GBP/JPY tumbled some 130 pips before correcting itself.

Today, the yen may very well continue with yesterday's trend. Last night's Tokyo Core CPI Report indicated that consumer prices in Japan fell at a slower rate then predicted, a positive sign for the Japanese economy. Furthermore, with U.S. dollar and euro both forecasted for slow close to the week, it is likely the Yen will once again come out on top.