LONDON/NEW YORK >> The yen rose for a second straight session against the dollar today, boosted by comments from a senior Japanese politician about normalising monetary policy, adding pressure on the Bank of Japan to continue hiking interest rates to boost the currency.

The dollar overall was higher as traders waited for inflation data later in the week, while the Australian and New Zealand dollars continued to struggle after China’s surprise interest rate cuts. The Aussie dollar is viewed as a proxy for China risks.

The dollar was last down 0.6% against the Japanese yen at 156.08. It earlier fell to a five-week low of 155.375 on Thursday.

Senior ruling party official Toshimitsu Motegi said overnight that the Bank of Japan should more clearly indicate its resolve to normalise monetary policy, including through steady interest rate hikes. The BOJ next sets rates on July 31.

Most economists polled by Reuters expect the BOJ to keep rates on hold at the meeting. It last raised rates in March to a range of 0%-0.1% from -0.1%.

Thierry Albert Wizman, global FX and rate strategist at Macquarie in New York said the yen may have gotten a boost from the politician’s comments and expectations about a potential policy move higher next year.

“But we have to keep in mind that the BOJ has demonstrated a willingness to intervene. We also know that positioning is already long dollars.”

The yen has found some support on the back of Tokyo’s recent bouts of intervention to prop up the currency and as traders looked to the BOJ’s decision.

In late morning trading, the dollar index, which tracks the U.S. currency against six peers, rose 0.2% to 104.51, after falling to a four-month low of 103.64 last week.

The dollar reacted little to data showing U.S. existing home sales fell more than expected in June as the median house price set another record high.

Home sales dropped 5.4% last month to a seasonally adjusted annual rate of 3.89 million units, the lowest level since December, data showed.

Meanwhile, the median existing-home price soared 4.1% from a year earlier to an all-time high of $426,900, the second straight month it scaled a record peak.

In other currencies, the euro was down 0.4% against the dollar at $1.0849. Sterling was 0.1% lower at $1.2912.

The Australian and New Zealand dollars struggled to regain their footing today after China’s move to cut several key interest rates.

China surprised markets on Monday by cutting major short and long-term interest rates in its first such broad move since last August, signalling intent to boost growth in the world’s second-largest economy.

The two Antipodean currencies extended losses after slumping in the previous session in the wake of the news.

The Australian dollar fell to a three-week low of US$0.6612, while the New Zealand dollar hit its weakest level since early May at US$0.5952.

“We have seen a sell-off in commodities overnight and the worry is whether or not China will be able to dig its way out of its slow growth period,” said Macquarie’s Wizman. “Some people are seeing the interest rate cuts as a sign of desperation for policymakers, creating a bit of a haven trade for the U.S. dollar.”

Trading was relatively subdued in a week with little in the way of economic data until the release of U.S. personal consumption expenditure (PCE) inflation figures for June on Friday.

The market reaction to President Joe Biden’s decision to bow out of the election race was muted, though there was some unwinding of the so-called Trump trade, which has seen the dollar and U.S. Treasury yields ease a touch.

In cryptocurrencies, the first U.S. exchange-traded funds (ETFs) tied to the price of ether, the world’s second-largest cryptocurrency after bitcoin, began trading today.

Ether was last down 0.4% at $3,477, while bitcoin also fell, down 1.7% at $67,050.