Yen Eyes Possible Rate Hike as New Zealand Dollar Surges

The yen shows signs of strength amid potential BOJ rate hikes. New Zealand's dollar rises following central bank's policy outlook. Analysts eye Thanksgiving for possible Japanese intervention. U.S. economic data presents case for Fed rate cut. Australian dollar gains on inflation data.

The Japanese yen held its ground on Wednesday, bolstered by anticipation that the Bank of Japan might increase interest rates as soon as December. Meanwhile, the New Zealand dollar surged after the country's central bank indicated an end to its easing cycle.

The yen initially rose after reports of a potential BOJ rate hike, reaching an intra-day high before settling slightly lower at 156.07 per dollar. Concerns about Japan's fiscal position and a cautious BOJ have pressured the yen, with a potential market intervention by Tokyo looming.

As U.S. Thanksgiving approaches, analysts suggest reduced liquidity could provide an opportunity for Japanese authorities to act. Elsewhere, the Australian dollar climbed following positive inflation data. In the U.S., weak economic indicators reinforced expectations of a December rate cut by the Federal Reserve.

(With inputs from agencies.)