(fxcue news) - The Japanese yen strengthened against other major currencies in the European session on Tuesday, following Bank of Japan Governor Kazuo Ueda's dovish remarks and incoming Prime Minister Shigeru Ishiba's unexpected resistance to additional rate increases. Optimism about the U.S. economic outlook, rising bets that the Bank of Japan will forgo raising interest rates again this year, also bolstered the trader's sentiment. Prime Minister Shigeru Ishiba reportedly said his government is aiming to compile a supplementary budget for the current fiscal year in excess of last year's 13.1 trillion yen ($87.6 billion) to fund an economic support package. Fed Governor Christopher Waller on Monday signaled that future U.S. Fed interest rate cuts will be less aggressive than the big move in September, following mixed data points in recent days. In economic news, data from the Ministry of Economy, Trade, and Industry showed that Japan's industrial production decreased as initially estimated in August. Industrial production contracted 3.3 percent on a monthly basis, reversing a 3.1 percent rebound in July. That was in line with the flash data published earlier. Year-on-year, industrial production declined 4.9 percent in August versus a 2.9 percent rise in the prior month. In the European trading today, the yen rose to 4-day highs of 162.37 against the euro and 148.85 against the U.S. dollar, from early lows of 163.36 and 149.79, respectively. The yen may test resistance near 157.00 against the euro and 142.00 against the greenback. The yen advanced to a 6-day high of 172.80 against the Swiss franc, from an early low of 173.69. On the upside, 168.00 is seen as the next resistance level for the yen. Against Australia, the New Zealand and the Canadian dollars, the yen climbed to a 5-day high of 99.94, a 4-day high of 90.60 and nearly a 2-week high of 107.81 from early lows of 100.77, 91.22 and 108.50, respectively. If the yen extends its uptrend, it is likely to find resistance around 98.00 against the aussie, 88.00 against the kiwi and 104.00 against loonie. The yen edged up to 194.65 against the pound, from an early low of 195.68. The next possible upside target for the yen is seen around the 190.00 region. Looking ahead, Canada CPI data for September, U.S. NY Empire State manufacturing index for October, U.S. Redbook report and U.S. consumer inflation expectations for September are set to be released in the New York session.