Ella 
The yen rose for the fourth straight session against the dollar, hovering near a 12-week high of 152.64 hit on Thursday. The yen’s strength could be due to traders unwinding carry trades ahead of the Bank of Japan’s policy meeting next week.
The Bank of Japan is expected to raise interest rates at its meeting next week, triggering short-term short liquidation and boosting the yen. In addition, the market generally expects the Bank of Japan to outline plans to reduce its massive monetary stimulus by reducing its bond purchases.
The dollar/yen exchange rate fell to its lowest level in more than two months on Wednesday as Japan’s Finance Minister Shunichi Suzuki and top monetary diplomat Masato Kanda avoided commenting on foreign exchange matters, according to Reuters.
The dollar could strengthen after recent U.S. Purchasing Managers’ Index (PMI) data showed that private sector activity expanded at a faster pace in July, highlighting the resilience of the U.S. economy to continue growing despite high interest rates. The data would provide more leeway for the Federal Reserve (Fed) to maintain its restrictive policy stance if inflation shows no signs of easing.
Investors will be closely watching the U.S. second-quarter gross domestic product (GDP) annualized data due on Thursday and personal consumption expenditures (PCE) inflation data due on Friday. The reports are expected to provide new insights into the state of the U.S. economy.
