Forex - Japanese yen retains strength after BoJ minutes, Aussie slumps

Investing.com - The Japanese yen retained strength on Friday after the release of central bank board meeting minutes and bank lending figures.

USD/JPY traded at 107.81, down 0.24%, after the minutes while AUD/USD changed hands at 0.8764, down 0.88%, as the market continued to react to jobs data revisions by the Australian Bureau of Statistics. EUR/USD traded at 1.2694, down 0.34%.

The Bank of Japan released minustes of its September monetary policy meeting that showed at least one of the nine board members said a target of 2% sustained inflation by fiscal 2015 will be hard to hit and that a majority of members said it was key to monitor inflation expectations across the economy.

Japan bank lending figures for September showed a gain of 2.4% on year.

In Australia at 1030 local time come August home loans, with a 0.1% rise seen, and housing finance.

Overnight, the dollar firmed against most major currencies in the wake of upbeat U.S. jobless claims data, while dovish comments from European Central Bank Mario Draghi pushed the euro lower and further bolstered the greenback's appeal.

The U.S. Department of Labor reported earlier that the number of individuals filing for initial jobless benefits in the week ending Oct. 4 fell by 1,000 to 287,000 from the previous week’s revised total of 288,000.

Analysts had expected jobless claims to rise by 6,000 to 294,000 last week, and the numbers gave the greenback room to brush off a dovish Federal Reserve report.

The dollar softened broadly on Wednesday after the minutes of the Fed's Sept. 16-17 policy meeting revealed that a number of monetary authorities believe the bank's current language painted the wrong picture on the timing of rate hikes and that an interest rate rise should be tied to U.S. economic recovery.

The minutes also showed that the U.S. central bank cut its growth outlook due to a stronger dollar and concerns over global weakness.

Elsewhere, European Central Bank President Mario Draghi spoke earlier and reiterated that the institution's willingness to loosen policy to steer the euro area away from deflationary decline if needed, adding that markets are expecting the bank to begin hiking interest rates some time in 2017.

The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.04% at 85.62.

On Friday, the U.S. is to round up the week with data on import prices.