• AUD/JPY edges lower following the hawkish speech by the BoJ Governor Ueda in Parliament.
• The BoJ could raise interest rates further if its economic projections are accurate.
• The downside of the Aussie Dollar may be limited due to the hawkish RBA.

AUD/JPY halts its three-day winning streak, trading around 97.50 during the European hours on Monday. The Japanese Yen (JPY) gained ground against the Australian Dollar (AUD) as Bank of Japan (BoJ) Governor Kazuo Ueda delivered a hawkish speech in Parliament on Friday.

BoJ Governor Ueda said that the central bank could raise interest rates further if its economic projections are accurate. Additionally, recent Japan’s inflation data reinforced the BoJ’s hawkish stance on its policy outlook.

Japan's National Consumer Price Index (CPI) rose by 2.8% year-on-year in July, maintaining this rate for the third consecutive month and holding steady at its highest level since February. The National CPI excluding Fresh Food also rose by 2.7%, matching expectations and reaching its highest level since February.

However, the downside of the AUD/JPY cross could be limited as the Australian Dollar may gain ground due to the rising market optimism following the dovish speech from the US Federal Reserve (Fed) Chairman Jerome Powell at the Jackson Hole Symposium on Friday.