Dollar firms, yen wobbles as Japan inflation holds above BOJ target
Position added successfully to:
By Ankur Banerjee
SINGAPORE (Reuters) — The dollar was steady on Friday as data pointed to U.S. labour market resilience that could lead the Federal Reserve to keep interest rates higher for longer, while the yen wobbled after Japan's core consumer inflation re-accelerated in June.
Central bank meetings from Europe, Japan, and the United State are due next week, with investors parsing through data to better gauge monetary policy paths they will likely chart.
The Japanese yen was at 140.10 per dollar, flat for the day, after nationwide core consumer price index rose 3.3% in June from a year earlier, matching a median market forecast, but remained above the Bank of Japan's 2% target.
The data bolsters the chances the BOJ will revise up this year's inflation forecast in fresh projections due next week.
Carol Kong, a currency strategist at Commonwealth Bank of Australia (CBA), said the market expectations for a BOJ policy tightening have ebbed and flowed over the past year.
«The window for the BOJ to tighten policy is narrowing,» Kong said, adding that CBA's base case is for the BOJ to keep monetary policy unchanged this year.
BOJ Governor Kazuo Ueda earlier this week said Japan was still distant from sustainably achieving the bank's 2% inflation target, dousing speculation that a tweak to yield curve control was on the cards next week.
More than three-quarters of economists polled by Reuters expect the BOJ to hold policy steady including its yield control scheme.
The yen has slipped about 1% against the dollar this week and is on course to snap its two-week winning run.
Sterling last fetched $1.2881, up 0.12% on the day and was set to snap its 5-day losing streak. Investor focus will be on
Read more on investing.com
