The yen outperformed its Group-of-10 peers after Japan's wage growth accelerated to the fastest clip since June, strengthening the case for the Bank of Japan to end its negative interest-rate policy in the near term.

USD/JPY fell as much as 0.6% to 148.56, the lowest since Feb. 8. Yen purchases were seen over the Tokyo fix as long dollar liquidation intensified, according to Asia-based FX traders.

Leveraged selling of dollars was also seen as some Japan government officials were said to be supporting the end of BOJ's negative interest rate either in March or April, the traders said.

Yen traders will remain jittery amid any further commentary from officials and the the US rate outlook, said Shoki Omori, chief desk strategist at Mizuho Securities Co. in Tokyo. "I have a feeling that Mr. Ueda is going to come out dovish in his speech later today, weakening the yen again".

The Bloomberg Dollar Spot Index fell 0.1% to take losses into a fifth day.

Yield on 10-year Treasury note rose two basis points to 4.12%.

Federal Reserve Bank of Minneapolis President Neel Kashkari said he expects the Fed to cut interest rates two times — or potentially just once — in 2024.

AUD/USD rose 0.1% to 0.6567.

Source: Bloomberg