Yen Rises Amid BoJ Rate Hike Prospects

(RTTNews) - The Japanese yen strengthened against other major currencies in the European session on Thursday, as traders speculate that the Bank of Japan is likely to increase its interest rate in light of indications that inflation is broadening in Japan.

On Friday, traders anticipate important inflation data from Japan and the U.S.

The JPY's role as a safe haven is further supported by allegations that U.S. President Donald Trump was thinking of replacing Federal Reserve (Fed) Chair Jerome Powell. These claims also raise questions about the central bank's future independence.

In the European trading today, the yen rose to a 2-day high of 179.61 against the Swiss franc, a 10-day high of 143.75 against U.S. dollar and nearly a 2-week low of 105.04 against the Canadian dollar, from early lows of 180.36, 144.97 and 105.74, respectively. If the yen extends its uptrend, it is likely to find resistance around 177.00 against the franc, 142.00 against the greenback and 104.00 against the loonie.

Against the euro and the pound, the yen edged up to 168.56 and 197.71 from early lows of 169.40 and 198.60, respectively. The yen may test resistance around 165.00 against the euro and 193.00 against the pound.

Against the Australia and the New Zealand dollars, the yen advanced to 94.07 and 87.16 from early lows of 94.61 and 87.78, respectively. On the upside, 93.00 against the aussie and 85.00 against the kiwi are seen as the next resistance levels for the yen.

Looking ahead, Canada average weekly earnings for April, Canada wholesale sales data for May, U.S. durable goods orders for May, U.S. GDP data for the first quarter, U.S. Chicago Fed National Activity index for May, U.S. goods trade balance for May, wholesale inventories for May, U.S. weekly jobless claims data and U.S. PCE prices for the first quarter are slated for release in the New York session.