The dollar index was a tad lower on Friday, and on track for its worst week for a month after the Federal Reserve trimmed its long-term rate expectations and the Bank of Japan retooled its monetary policy framework.
The safe-haven yen strengthened on Monday as investors sold stocks and riskier assets including commodities, but the dollar outperformed higher-yielding currencies on fresh talk of an interest rate hike by the Federal Reserve in the near term.
The yen hit its lowest in nearly three weeks against the dollar on Tuesday and shed 1.4% versus the euro, as a weekend election victory by Japan's ruling coalition paved the way for more stimulus, bolstering risk sentiment.
The yen powered to a 17-month high against the dollar on Thursday, with the U.S. currency broadly under pressure after minutes of the Federal Reserve's meeting last month underscored its caution about future interest rate hikes.
The U.S. dollar fell to its lowest level in five months against the euro on Thursday in trade dominated by month-end rebalancing flows, putting the dollar index on track for its worst quarterly performance in five years.