Yen lifted by short squeeze, dollar choppy

Yen lifted by short squeeze, dollar choppy

A much larger number would be seen as hawkish and undoubtedly provide a boost to the dollar and put emerging market currencies under renewed pressure. Conversely, any delay in tapering will be interpreted as dovish, traders said.

Many emerging market currencies, hit hard by an outflow of funds, have retraced some of their deep losses in recent sessions.

(Read more: IMF: Emerging markets can rely on us)

“This is likely the result of profit taking, marginally better China data and investors becoming more sanguine over risk events next week,” said Oliver Harvey, a London-based analyst at Deutsche Bank.

“From here on in, markets should discriminate more between currencies, particularly if risk remains buoyant,” Harvey said, adding the Indonesian rupiah, Turkish lira and South African rand remained vulnerable.

There are no major economic data out of Asia on Friday, leaving the focus on U.S. retail sales due later in the day.

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