Currency Market Reactions: Yen Rises, Euro Steadies Awaiting ECB Decision

Japan's yen reached a six-week high on Thursday, prompting speculation of official intervention. Meanwhile, traders await a European Central Bank meeting to guide the euro's next move. The euro remained close to four-month highs as the ECB is expected to maintain its current monetary policy, with future interest rate cuts hinging on further declines in inflation and wage growth.

Commonwealth Bank of Australia's Joe Capurso noted that the risk lies in a reduced chance of a September rate cut. The euro was stable at $1.09325, with traders forecasting at least one more rate cut this year in the eurozone. The British pound dipped below $1.30 following slower-than-expected wage growth but remains the best-performing major currency against the dollar.

The yen surged by as much as 0.53% overnight as the dollar continued its slide. Data indicated potential official intervention, with traders reacting to the possibility. U.S. presidential candidate Donald Trump's comments on the dollar's strength also impacted the market. Despite a 9% decline this year, the yen showed signs of recovery, while China's yuan firmed slightly.

(With inputs from agencies.)