© Reuters. FILE PHOTO: U.S. Dollar and Euro notes are seen in this June 22, 2017 illustration photo. REUTERS/Thomas White/Illustration
By Hannah Lang and Amanda Cooper
WASHINGTON/LONDON (Reuters) -The yen staged its biggest one-day rally in almost a year on Thursday after Japanese monetary authorities offered a surprisingly clear hint at a shift in policy, while the euro headed for its biggest weekly fall since May.
The eased ahead of Friday’s U.S. non-farm payrolls report, under pressure mostly from the yen, which rose by nearly 2% to its strongest in three months.
Bank of Japan (BOJ) Governor Kazuo Ueda said on Thursday the central bank has several options on which interest rates to target once it pulls short-term borrowing costs out of negative territory.
Markets took this as a potential sign that change may be imminent and pushed the yen higher.
“The comments last night sort of poured rocket fuel into bets on an eventual move back into positive rates territory for the Bank of Japan,” said Karl Schamotta, chief market strategist at Corpay in Toronto.
The dollar was last down 2.01% against the yen at 144.35.
The BOJ has been the lone holdout among central banks, by…
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