Most Asian currencies moved little on Friday as traders positioned for a potentially softer U.S. nonfarm payrolls reading, while the yen sat near a four-month high to the dollar tracking hawkish signals from the Bank of Japan.<\/p>\n
The\u00a0yen<\/a><\/span>\u00a0was the best-performing Asian currency this week, up over 2% after BOJ Governor Kazuo Ueda signaled that the central bank was considering an eventual move away from negative interest rates.<\/p>\n The yen rose 0.2% to 143.88 against the dollar on Friday.<\/p>\n Ueda\u2019s comments, made during an address on Thursday, sparked a sharp reversal in bets for more weakness in the yen, while reinforcing expectations that the BOJ will end its negative rate regime in 2024.<\/p>\n This helped the yen strengthen past data showing that Japan\u2019s\u00a0economy shrank more than initially estimated<\/a><\/span>\u00a0in the third quarter. Ueda also noted that policy will remain loose in the near-term to keep supporting the Japanese economy.<\/p>\n Broader Asian currencies were muted, while the dollar reversed a recent rebound following a string of soft labor market readings this week.<\/p>\n The\u00a0dollar index<\/a><\/span>\u00a0and\u00a0dollar index futures<\/a><\/span>\u00a0steadied in the mid-103s in Asian trade, after falling sharply on Thursday.<\/p>\n Job openings<\/a><\/span>\u00a0and\u00a0private payrolls<\/a><\/span>\u00a0readings suggested that the U.S. labor market was cooling, potentially setting the scene for a softer\u00a0nonfarm payrolls<\/a><\/span>\u00a0reading for November, which is due later in the day.<\/p>\n Any signs of a cooling labor market give the Federal Reserve less impetus to keep interest rates higher for longer. Friday\u2019s reading also comes just days before the\u00a0Fed\u2019s final meeting<\/a><\/span>\u00a0for the year, where the central bank is expected to keep rates on hold.<\/p>\n But markets were still seeking more cues on when the Fed could begin cutting rates in 2024. Expectations that\u00a0rate cuts could come as soon as March 2024<\/a><\/span>\u00a0had boosted Asian currencies in recent sessions.<\/p>\n Most regional units moved little in anticipation of the payrolls reading. The\u00a0Chinese yuan<\/a><\/span>\u00a0fell 0.1%, and was set for mild weekly losses amid persistent concerns over an economic slowdown in China. Dollar selling by Chinese state banks helped limit losses in the yuan this week.<\/p>\n The\u00a0Indian rupee<\/a><\/span>\u00a0was flat after the\u00a0Reserve Bank of India<\/a><\/span>\u00a0kept rates on hold as widely expected, and said that monetary policy will remain restrictive to curb persistent risks from inflation.<\/p>\nDollar weakens as markets bet on softer nonfarm payrolls<\/h3>\n