NEW YORK: The dollar gained on the euro on Thursday after a US Federal Reserve policy maker said he wasn’t in a hurry to cut rates, while traders also prepared for key US economic data due on Friday and squared positions for month- and quarter-end.

The Japanese currency was slightly firmer at 151.26 per dollar having traded just shy of the 152 mark at its weakest since 1990 on Wednesday before Japan’s top monetary officials suggested they were ready to intervene to prevent further declines.

Fed Governor Christopher Waller said late on Wednesday that recent disappointing inflation data affirms the case for the US central bank holding off on cutting its short-term interest rate target.

“Waller is one of the more important Fed policy makers and, while I don’t see this being a big move, the remarks have put some momentum into the market which has been stuck in very tight trading ranges,” Lee Hardman, senior currency strategist at MUFG, said.

Market expectations for the first rate cut to occur at the Fed’s June meeting have eased as traders prepared for the possibility that the US central bank could hold rates higher for longer. Current pricing has it at a 64% chance, compared with 70% around this time last week, according to the CME Group’s FedWatch tool.

But stickier-than-expected inflation in January and February is unlikely to be replicated in March, Helen Given, FX trader at Monex USA, said. The Fed is unlikely to change its rate cut projections, she added.

“Today’s movement is a little bit outsized and I think its really to do with the fact that there’s just slim flows across the world,” Given said.

This week’s main economic focus is Personal Consumption Expenditures (PCE) data due on Friday. Fed Chair Jerome Powell is also due to speak on Friday.

Data on Thursday showed that the US economy grew faster than previously estimated in the fourth quarter, lifted by strong consumer spending and business investment in nonresidential structures such as factories.

The euro reached $1.0775, its lowest in five weeks, and was last down 0.16% at $1.0809. The pound strengthened 0.05% to $1.264.

The dollar index fell 0.05% to 104.37, after earlier touching 104.73, its highest since mid-February.

Analysts expect portfolio managers to sell the greenback for month- and quarter-end rebalancing.

Should the inflation data on Friday surprise on the upside and support the dollar, its most dramatic impact could be on the yen. Market participants say there is a dense thicket of options restricting moves in dollar/yen around the 152 level, and so a breakthrough could trigger more significant moves.

Japanese authorities held a meeting on Wednesday on the currency’s weakness and ramped up their verbal warnings, putting the market on the lookout for any signs that words are being backed up with action.

Japanese Prime Minister Fumio Kishida also said on Thursday the government will not rule out any options in addressing excessive moves in the currency market, stressing Tokyo’s resolve to step into the market if it sees the yen’s fall as overdone.