The Euro (EUR) is showing mixed reactions against the Japanese Yen (JPY) following US Treasury Secretary Scott Bessent's latest interview with CNBC, where he made bold predictions on oil prices and the Yen's trajectory. EUR/JPY is trading near 185.20, down around 0.1% during Monday's European session, as the Japanese Yen outperforms major currencies amid growing expectations that the Bank of Japan (BoJ) will raise interest rates in the September policy meeting. Bessent's comments have added fresh momentum to Yen strength, with markets now pricing in a higher probability of coordinated intervention between the US and Japan. Meanwhile, oil prices have already started responding to his remarks, with Brent crude slipping below $80 per barrel as traders bet on a potential US-Iran deal that could ease supply constraints.

Bessent's oil price forecast is closely tied to geopolitical developments with Iran. A potential truce between the US and Iran could lead to the reopening of the Strait of Hormuz, allowing maritime traffic to resume and easing supply bottlenecks. Oil prices have already responded, with Brent crude trading below $80 per barrel.

Impact on Forex Markets: The Canadian Dollar (CAD) and Norwegian Krone (NOK) could face headwinds from lower crude prices, while the US Dollar (USD) might see mixed reactions as lower oil eases inflation pressures, potentially allowing the Fed to pivot sooner.

Traders should closely monitor developments regarding US-Iran negotiations and any further statements from the Treasury Department or the Bank of Japan. As Bessent himself emphasized, the Federal Reserve's policy decisions are not something he will speculate on, but the ongoing "detox" from forward guidance means every meeting should be considered "live".