TOKYO: The yen struggled in Asia on Friday as investors eye third-quarter Japanese growth figures next week while speculation speculation swirls of a delay to a controversial sales tax hike and a possible snap election next month.
In Tokyo, the greenback hovered around seven-year highs at 116.04 yen, up from 115.75 yen on Thursday in New York, while the euro climbed to 144.53 yen from 144.42 yen.
The European single currency weakened to $1.2454 against $1.2476.
Forex markets were likely to tread water ahead of Monday's release of gross domestic product data for July-September, analysts said, after the previous three months saw a contraction. Another negative reading would put the economy in technical recession.
Prime Minister Shinzo Abe is facing calls to put off the increase in sales tax, which is due in October, after a similar increase in April threw a nascent economic recovery into reverse. Reports have also said he is thinking of calling a snap election next month, which his party would more than likely easily win.
Tokyo has said the growth figures will be key to its decision on whether or not to usher in the next tax hike.
"All eyes are on Monday's third-quarter gross domestic product data, which will be used to justify everything that's being reported in the press -- from the imminent dissolution of the lower house to the putting off of next year's sales tax hike," Kazuyuki Terao, chief investment officer at Allianz Global Investors, told Dow Jones Newswires.
In other trading, the pound slipped to $1.5677 from $1.5708 in New York after the Bank of England this week cut its growth and inflation forecasts, suggesting interest rates will be kept at record lows for some time to come.
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