Yen Rebounds as BOJ Governor Hints at Data-Driven Interest Rate Decisions

The Japanese yen strengthened after the Bank of Japan's governor indicated interest rates will depend on economic data. Traders are awaiting fresh market catalysts. Meanwhile, Nvidia's strong earnings and rising tariff rates in the U.S. are influencing market sentiment.

The Japanese yen experienced a rebound on Thursday following remarks from Bank of Japan Governor Kazuo Ueda, who linked potential interest rate increases to Japan's economic conditions. This movement comes amidst a backdrop of subdued market activity as traders anticipate new developments to guide their decisions.

Prime Minister Sanae Takaichi expressed concerns about further rate hikes, contributing to the yen's strength by 0.22% against the dollar. As traders evaluate trade tariffs and economic sentiment, the dollar index showed a slight increase, while the euro saw minimal upward movement.

Despite Nvidia's promising earnings influencing risk sentiment and potential tariff rate increases by the U.S., market conviction remains uncertain. Both the Federal Reserve and European Central Bank's expectations play into this uncertainty, with the labor market and inflation rates being key considerations.

(With inputs from agencies.)