Agencies: The dollar is set for its best week since July, and the yen is at a disadvantage

The U.S. dollar held steady on Friday and is on track for its strongest weekly performance since July, as expectations of a sharp and early U.S. interest rate cut this year weakened ahead of the closely watched U.S. non-farm payrolls data. A strong start to the US dollar has cast a shadow over the yen, which fell 2.5% against the dollar in the first week of the year, its worst weekly performance since August 2022. However, the dollar's rebound is expected to be tested by the non-farm payrolls report due later. Moh Siong Sim, FX strategist at Bank of Singapore, said the market may have been ahead of the curve at the end of last year when it came to pricing in a soft landing. This week's data shows that the U.S. job market appears to be holding steady, and perhaps the Fed still needs to emphasize that Intrerest Rate will be maintained for a little longer than the market has already priced in.