• The Japanese Yen faces slight selling pressure against its major peers amid rising energy prices.
• Intensifying Middle East conflicts have boosted oil prices.
• Both the BoJ and the Fed are expected to leave interest rates unchanged in their policy meetings next week.

The Japanese Yen (JPY) trades lower against its major currency peers, but is marginally higher against the US Dollar (USD) at around 162.35 during the early European trading session on Monday.

The Asian-Pacific currency is under pressure as surging oil prices due to energy supply disruption through the Strait of Hormuz, a critical checkpoint to almost 20% of global energy supply, have weakened currencies from energy import-dependent economies.

The continuous attack from the Iranian military on oil tankers attempting transit through the Hormuz has dampened confidence of shipping companies to use the passage.

Iran's Islamic Revolutionary Guard Corps (IRGC) said that two oil tankers were blown up after attempting to transit the southern route of the Hormuz, adding that the passage will not be safe for petrochemical products or 'single drop of oil and gas' transit as long as US actions in the region continue, The Guardian reported.

On the monetary policy front, the Bank of Japan (BoJ) is expected to keep interest rates unchanged at 1% in the July policy meeting, Kyoto reported, as stated by people familiar with the matter. The report also showed that the central bank will indicate that the monetary policy path will remain on the upside and will likely raise the growth forecast for the year.

Meanwhile, the US Dollar trades lower amid hopes that the Federal Reserve (Fed) will not cut interest rates in the policy meeting later this month.