The dollar weakened against most of its main competitors in trade weakened by Thanksgiving in the United States, with the pound sterling at its highest level since November 20. The yen jumped 1% to 150 per dollar, its highest level in six weeks, on Friday after faster-than-expected inflation in Tokyo supported bets on a rise in interest rates by the Bank of Japan next month.

The Euro moved closer to its highest level for a week on Wednesday after recovering from a slight drop in the previous session to end the day without much change. The euro gained 0.13% to $1.0568, approaching Wednesday's peak of $1.058775. The head of the ECB, François Villeroy de Galhau, said on Thursday that the central bank should keep its options open for a bigger cut in rates next month

The yen has made a notable comeback, with gains of around 3%. Beyond the weakness of the dollar, exacerbated by falling Treasury bond yields, the Japanese currency was also boosted by flows to safe havens in the context of Trump's general warnings about tariffs on Mexico, Canada, and China this week, and by growing bets that the BOJ will raise rates again on December 19.

Sterling rose 0.16% to $1.27085, after touching $1.2712 earlier.

The Chinese yuan appreciated slightly against a weak dollar, on the verge of making its first weekly gain in two months, which partly reflects Beijing's success in slowing the currency's fall in the face of Donald Trump's tariff threats. The yuan was trading around 7.2333 at midday, 0.15% higher than Thursday's closing price, after rebounding 0.3% from a four-month low hit on Tuesday. The yuan has fallen by 1.6% since the beginning of November, on the verge of achieving its worst monthly performance since June 2023.

The South African rand strengthened in early trading on Friday, ahead of a busy day of local economic data, which analysts say could influence the currency in the coming weeks. The rand was trading at 18.0625 against the dollar at 06:36 GMT, about 0.3%