By Gina Lee

Investing.com – The dollar was down on Friday morning in Asia, and the Japanese yen was set for its worst week in two years. Rising import costs and low interest rates contributed to the yen’s downward trend, but commodity currencies were set for a second consecutive weekly gain on the dollar as export prices continue to soar.

This chart tracks the greenback’s performance against other currencies. It was at 11:43 ET (03:43 GMT), down 0.2% to 98.540

The pair plunged 0.61% to 121.58. Also, the grew 0.2% monthly.

Both the pair grew by 0.08% to 0.7518, and 0.06% respectively to 0.6969.

Both the pair dropped 0.1% to 6.3616 and climbed 0.19% up to 1.3208.

Concerns that rising energy and food costs stemming from Russia’s invasion of Ukraine on Feb. 24 could hurt the European economy continue. The dollar was slightly weaker throughout this week, and was stuck at $1.1005.

Australia was an important exporter of energy and food and saw its prices rise. The Aussie experienced a second week of greater than 1%.

The yen fell 2.6% against the US dollar over the past week. It has fallen to 120 and is now eyeing resistance at 123.70. The yen has fallen almost 6% against the dollar since March 2022 and dropped around 8% in just eight sessions.

A hawkish comment by Jerome Powell (US Federal Reserve Chairman) earlier in the week triggered this latest decline. This also caused a spike in U.S. yields. While the Bank of Japan (BOJ), for its part has maintained a more cautious tone than the Fed’s, some investors warn that the yen, which is at an all-time low of six years, could be heading towards unfavorable depths.

Brent Donnelly (Spectra Markets trader, president) said to Reuters that there is one thing to be on the lookout for in dollar/yen: pushback from Japanese policymakers.

Although I’m not certain we are there, the level of 123.50/125.00 is likely to draw attention from Fumio Suzuki (Japan Prime Minister) and Shunichi Suzuki (Minister of Finance). Pushback could also come from BOJ Governor Haruhiko Kuroda,” he said.

The recent moves in the bond market have also put central banks in an awkward spot. A challenge in yield curve control may lead to further weakness of the yen. The yield on Japanese 10-year government bonds reached 0.235% Friday. It was close to the 0.25% upper limit.

The Russian rouble traded firmly in Thursday’s European session after President Vladimir Putin vowed to start selling gas to “unfriendly” countries in the currency. The Russian rouble lost some of its gains from thin offshore trade, and traded last at 102 US dollars.