Yen rose as timid U.S. economic data and surging global coronavirus cases kept investors watchful.

The trade volume is light today because of a U.S. bank holiday. The pair could remain in a tight range with U.S. Treasury markets closed. The recent recovery in the pair has been driven by a surge in Treasury yields.

Risk sentiment and Treasury yields are expected to continue to be the key drivers over the short-run. Investors are eyeing the interest rate differential between U.S. Government bonds and Japanese Government bonds.

Later in the week, President-elect Biden is due to be inaugurated in Washington. Tensions are high after mob violence a few weeks ago.

US Treasury Secretary, Janet Yellen, is expected to rule out seeking a weaker dollar when testifying on Capitol Hill tomorrow.