The Dollar-Yen pair bounced from its lowest level since July at 140.23 to 141.65 during the early Asian session on Friday. The economic calendar is of little relevance amid low trading volume on the last trading day of 2023.

Investors raised expectations for an interest rate cut by the Federal Reserve (Fed) due to a signal of cooling inflation. This, in turn, has pressured the US dollar in the past few sessions. The US central bank confirmed that there will be no rate hike in 2024, while hinting at a 75 basis points (bps) rate easing. As for the data, the initial jobless claims report from the US Department of Labor came in at 218k vs. 210k expected.

Regarding the Japanese yen, Bank of Japan (BoJ) Governor Kazuo Ueda said on Wednesday that he is in no hurry to wind down loose monetary policy as the risk of inflation exceeding 2% and rising further is minimal. Ueda added that a key factor will be whether the wage hike will be extended to smaller companies during the annual spring wage discussion in 2024, although the BOJ may make a decision even before the outcome of the wage discussion at smaller companies is known if their profits are high enough.

Recommendations:  Trade predominantly on Buy from the current price level