At 3 AM ET (0700 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.8% higher at 104.245. That occurred after slipping to a one-week low of 103.41 overnight. It was a contrast to the two-decade high of 105.79 before the Fed decision.
USD/JPY rose 1.6% to 134.37 after a bout of volatile trading in the aftermath of the BoJ’s decision to keep its short-term interest rate target at -0.1% with a pledge to guide the 10-year government bond yield to around 0%.
This loose monetary policy places the BoJ in a room on its own after the U.S. Federal Reserve, the Swiss National Bank, and the Bank of England all hiked interest rates this week.
Japanese officials tried to provide some support for their beleaguered currency earlier Friday. The government and central bank issued a rare joint statement. They stated their concern over recent sharp falls in the yen. The strongest warning to date that Tokyo could intervene to support the currency as it plumbs 20-year lows.
Industrial numbers rising
Attention will shift to the release of U.S. industrial and manufacturing production later in the session for guidance. Meanwhile, industrial production number is expected to tick up 0.4% for May compared to a 1.1% gain for April. Manufacturing production will rise 0.3% in May, compared with an 0.8% gain the prior month.
Elsewhere, EUR/USD fell from 0.4% to 1.0504. It retreated from a one-week high in the wake of the European Central Bank’s decision to promise new support to contain borrowing costs among southern nations.