Dollar Surges as BOJ Rate Hike Fails to Impress

The US dollar rose against the yen after the Bank of Japan's interest rate hike was met with skepticism from two policymakers, who dissented from the decision. The BOJ raised rates to their highest level in 31 years at 1.25%, but without explicitly hawkish guidance.

The move did not boost the Japanese currency as traders expected, and instead led to a stronger dollar. Steven Englander, head of G10 FX research at Standard Chartered, noted that 'the lack of hiking punch makes it easier for USD to go higher.'

The dollar index was up 1.2% for the week, reaching a seven-week high after the US Federal Reserve hiked interest rates on Wednesday and signaled more increases could be coming.