Investing.com - The U.S. dollar ended Friday’s session at a seven-month high against the yen, after Federal Reserve Chair Janet Yellen said the central bank could raise interest rates sooner than expected if the job market continues to improve.
USD/JPY hit a daily high of 104.19 on Friday, a level not seen since January 23, before subsequently consolidating at 103.95 by close of trade, up 0.1% for the day and 1.53% higher for the week.
The pair is likely to find support at around the 103.49 level and resistance at about 104.20.
Speaking at the Fed's annual meeting of top central bankers and economists in Jackson Hole, Wyoming, on Friday, Yellen said the U.S. economy is recovering and added the labor market is improving as well.
Her remarks came after minutes of the Fed’s July meeting published Wednesday showed that some officials believe the strengthening recovery and ongoing improvement in the labor market supports a move towards tightening monetary policy.
Meanwhile, Bank of Japan Governor Haruhiko Kuroda told the Jackson Hole gathering that the central bank may have to pursue its aggressive monetary policy easing for "some time" to fully vanquish deflation.
His remarks were made on Saturday.
Meanwhile, tensions over the crisis in Ukraine remained in focus after NATO said it was observing an alarming increase in Russian forces near the border with Ukraine.
Ukraine declared on Friday that Russia had launched a "direct invasion" of its territory after Moscow sent a convoy of aid trucks across the border into eastern Ukraine where pro-Russian rebels are fighting government forces.
Elsewhere, the yen was higher against the euro, with EUR/JPY shedding 0.19% to 137.66 late Friday.
The single currency drifted lower after European Central Bank President Mario Draghi said in a speech that the central bank is ready to take more unconventional action if needed to stimulate a sluggish euro zone economy.
In the week ahead, investors will be looking ahead to key U.S. data for further indications on the strength of the economy and the possible future path of monetary policy.
The U.S. will produce data on second quarter gross domestic product, as well as reports on new home sales, durable goods orders and initial jobless claims.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Wednesday as there is no relevant data on that day.
Monday, August 25
The U.S. is to produce data on new home sales for the month of July.
Tuesday, August 26
The U.S. is to publish reports on July durable goods orders, as well as house price inflation and consumer confidence.
Thursday, August 28
The U.S. is to release revised data on second quarter GDP, as well as the weekly government report on initial jobless claims and data on pending home sales for July.
Friday, August 29
Japan is to release data on consumer inflation, as well as reports on industrial production, household spending and retail sales.
The U.S. is to round up the week with a report on personal income and expenditure and revised data from the University of Michigan on consumer sentiment.