USD/JPY eases from 147.50 as investors ponder the impact of Trump’s tariffs

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The US Dollar – Yen maintains its bullish trend intact, but price action has stalled below 147.50. Investors might be starting to worry about the impact of Trump’s tariffs on US economy. Later this week, US and Japan’s inflation readings are likely to set the pair’s near-term direction. The US Dollar is trimming previous gains against the Japanese Yen on Monday. It is trading practically flat, within Friday’s trading range, with the market mood cautious as investors come to terms with the negative impact of Trump’s hefty Tariffs on the US economy. The pair is holding most of the gains after Friday’s 0.8% rally, but it remains unable to find any significant acceptance at the 147.50 area, yet with downside attempts limited at 1.4685 so far. US President Trump rattled markets over the weekend, threatening to impose 30% tariffs on imports from the European Union and Mexico if a deal is not reached before the August 1 deadline. US tariffs are weighing on the US Dollar’s recovery These levies increase the 20% and 25% taxes announced on the April 2 liberation day and build on the 35% levies imposed on Canada a few days earlier and the 50% tariffs on copper, aluminium, and steel. Investors remain confident that this is only a negotiation tool. Still, the US president is unpredictable, and the potential impact of such trade restrictions on US inflation and economic growth seems to be starting to weigh on the US Dollar’s recovery. On Friday, the Chicago Fed President, Austan Goolsbee, warned that the new tariffs would complicate the bank’s inflation projections and might force policymakers to adopt a more cautious view on interest rate hikes and delay the easing measures that Trump is calling for. The calendar is thin today, and investors might be tempted to look…