Dollar Gains Momentum Against Yen Amid BOJ Rate Hike Uncertainty

The US dollar surged against the yen on Friday after two policymakers at the Bank of Japan (BOJ) dissented from a widely expected decision to raise interest rates, casting doubt among traders about the likelihood of further hikes.

The BOJ pushed rates to their highest level in 31 years at 1.25%, but the move failed to boost the Japanese currency as traders felt there was a lack of explicitly hawkish guidance.

Steven Englander, head of G10 FX research at Standard Chartered, said the 'lack of hiking punch makes it easier for USD to go higher.'

The dollar index rose 1.2% for the week to around a seven-week high after the US Federal Reserve hiked interest rates on Wednesday and signalled more increases could be coming.