Yen Hits One-Month High as AI Spending Doubts Spur Safe-Haven Demand; Dollar Index Falls to 101.52

The Japanese yen strengthened to its highest level in more than a month on Friday, rising 0.3% to 156.28 per dollar, as fresh risk aversion over the AI spending boom drove safe-haven flows and pushed US Treasury yields sharply lower. The dollar index fell to 101.52 after touching 101.44 on Thursday, its lowest since the start of the month. US 10-year Treasury yields hovered near a one-month low of 4.953%, having tumbled Thursday when equities sold off on renewed doubts about AI growth sustainability. Brent crude pushed above $114 per barrel, extending a 4% climb after Houthi attacks in Saudi Arabia raised energy supply concerns. The yen was set for a 1% weekly gain, its strongest since early September, ahead of the Bank of Japan's policy meeting next week. Japan's core consumer inflation exceeded the central bank's 2% target in September for the first time in nine months. ING analysts said they still expect the 10-year yield to eventually snap back above 5%.