Dollar slips as yen rallies after US-Japan reaffirm joint currency intervention stance

On Friday the U.S. dollar slipped 0.3% to a dollar index of 100.96, curbing a brief rally that had pushed it near a two-month high. The Japanese yen rebounded about 0.8% to 157.65 per dollar after Finance Minister Satsuki Katayama said President Donald Trump's recent remarks reinforced the United States-Japan joint stance on yen weakness, hinting at possible coordinated intervention. The euro rose 0.2% to $1.141 as oil prices eased, tempering expectations of further Federal Reserve rate hikes, while the pound climbed 0.3% to $1.326 following hawkish comments from Bank of England Governor Andrew Bailey, though both currencies remain on track for weekly declines.

Markets have been re-pricing U.S. interest-rate trajectories after the Fed's latest tightening, with long-dated Treasury yields hitting 20-year highs, yet lingering fiscal concerns and policy unpredictability curb the dollar’s momentum. Oil prices fell on signs of easing supply disruptions, though they stayed near a weekly peak after a Houthi missile strike on Saudi Arabia kept Middle-East tensions high. Elsewhere, the Australian dollar edged up to $0.703 as the Reserve Bank of Australia is expected to raise rates to a near-15-year high next week.