The dollar rose against major currencies on Friday, staging a small rebound against the yen and the Swiss franc following a rise in US bond yields, while the yen slipped against commodity currencies. Chinese trade data showed higher-than-expected imports for August, supporting commodity-linked currencies such as the Australian dollar against the low-yielding yen, which is often used to fund carry trades into higher-yielding currencies.
The dollar edged further off this week's 15-year low against the yen, helped by a rise in US Treasury yields the previous day and a widening in the US-Japan yield spread, but it struggled to clear resistance around 84.30 yen. "US bond yields have risen near their highest levels since last week's payroll data. I think the impact of the rise in US yields is driving the yen down," said Katsunori Kitakura, chief dealer at Chuo Mitsui Banking Corp.
The dollar rose 0.1 percent to 83.90 yen, fading back through 84.00 after briefly topping its five-day moving average of 84.27 yen for the first time in a week and its tenkan line on the daily Ichimoku chart at 84.29. "The next target will be its high of 85.23 yen hit after the payroll data," Kitakura said. Others expect strong resistance at 85 yen and above after the greenback failed to maintain gains at that level a week ago following stronger-than-expected US payroll data.
Japanese exporters are said to want to sell the dollar around that level ahead of half-year book closings at the month-end. The dollar hit a 15-year low of 83.34 yen this week, intensifying speculation that Japanese authorities might step in to curb yen gains if the move accelerates towards 80 yen. The dollar edged up against a basket of currencies, although it failed to hold above the index's 55-day moving average at 82.80.
It initially rose against the Swiss franc before giving back gains to stand flat on the day at 1.0150 francs, though it was still above this week's nine-month low of 1.0060 francs. The Australian dollar made no headway against the greenback although it held near a four-month high at $0.9278 set on Thursday after strong Australian jobs data. It slipped 0.1 percent to $0.9228. It held its ground against the yen at 77.42 yen but failed to keep gains made immediately after trade data out of China showed imports up an annual 35.2 percent in August, boding well for domestic demand and trading partners including Australia. The euro slid 0.1 percent to $1.2686, with support expected at its 100-day moving average at $1.2657. It eased slightly to 106.40 yen.
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