Dovish BoJ and Rebounding Oil Fuel Dollar Rally

The US dollar remained resilient throughout the week despite the Fed's hawkish tone. However, all eyes were on the Bank of Japan's rate decision, where a dovish hike sent the yen plummeting.

The BoJ raised rates by 25 basis points, but the 7-2 vote and lackluster guidance were enough to knock the yen lower. This caused USD/JPY to surge over 1% to climb above 158.00 handle, with the pair testing a key area of resistance between 158.00 to 158.50.

The price of oil has become a major focus for investors, and its rebound on Friday provided support for the dollar. With Brent crude prices bouncing back off their lows, traders are unwilling to bet against oil heading into the weekend.