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Yen stands firm after BOJ-inspired bull run; US jobs up next

Friday,   08-Dec-2023   03:45 PM (IST)

The yen headed for a fourth weekly gain against the dollar on Friday, after its biggest rally in almost a year the day before, driven by a burst of optimism among traders that Japan’s ultra-low rates policy may be nearing an end. The broad strength in the yen kept a lid on the dollar, which was also on the defensive ahead of the closely-watched U.S. nonfarm payrolls report due later on Friday. Bank of Japan (BOJ) Governor Kazuo Ueda said on Thursday the central bank had several options on which interest rates to target once it pulls short-term borrowing costs out of negative territory. Markets took those comments as the clearest sign yet that the BOJ could soon phase out its ultra-loose monetary policy and catapulted the yen to multi-month highs against a range of other currencies. Against the dollar, the yen held firm at 144.23 , having surged more than 1% earlier on. A month ago, the yen had hit a one-year lows of 151.92, crushed by the widening gap between U.S. and Japanese borrowing costs. In the past few weeks, the outlook for U.S. interest rates has switched to one of a series of cuts next year, which helped prise the yen off those lows.