LONDON, Jan 20 (Reuters) – The dollar was heading for its biggest one-day rally against the yen in two weeks on Friday, after the Bank of Japan governor reiterated there would be no change in the central bank’s handling of monetary policy.
The dollar was already up on the day against a basket of currencies, as a slew of data this week from consumer spending to business activity and inflation across major economies highlighted an increasingly fragile outlook for growth.
The U.S. currency has lost about 1.3% so far in January, having fallen nearly 8% in the final three months of 2022, when investors began factoring in a higher chance of the Federal Reserve slowing down the pace of interest-rate rises.
The Japanese yen bore the brunt of the dollar’s strength. The dollar rose by as much as 1.21% to a high of 129.965 – its largest one-day gain since Jan. 4. The yen, which investors have long favoured as a safe-haven and a funding currency,…
