Investing.com– Most Asian currencies were trading in a tight range on Friday, while the dollar stabilized at its highest levels in more than two months as mighty economic data boosted expectations for smaller interest rate cuts.

Regional markets drew no lessons from China’s gross domestic product data, which showed the economy grew in line with expectations in the third quarter. After the reading, the yuan strengthened slightly, but attention remains on further stimulus measures from Beijing.

The Japanese yen briefly weakened to levels last seen in overdue July, although a verbal warning from government officials allowed it to pare some of its losses.

Both indexes fell 0.1% in Asian trading after hitting their highest level in more than 2.5 months on Thursday following stronger-than-expected data. The reading, combined with signs of continued resilience in the labor market, led investors to largely maintain their assumptions about the Federal Reserve’s November 25-basis-point rate cut.

The Chinese yuan is slightly strengthening as GDP is in line with expectations

The Chinese yuan pair fell 0.1% after hitting its highest level in almost two months earlier this week.

grew in line with expectations by 4.6% year-on-year, although at a slower pace than the previous quarter. slightly exceeded expectations, although still below the government’s annual target of 5%.

The GDP data, while moderately positive, highlighted the need for greater economic support from Beijing. Over the past three weeks, the Chinese government has unveiled a series of stimulus measures, including both monetary and fiscal measures.

However, the lack of clear details regarding the schedule, implementation and scale of the planned activities led to confined optimism among investors.

USDJPY Flirts with 150 on Mixed CPI, Intervention Warning

The Japanese yen strengthened slightly after hitting its lowest level in almost three months earlier in the session. The pair fell 0.2% to 149.88 yen after rising as high as 150.29 yen.

The yen’s moderate recovery came after top currency diplomat Atsushi Mimura warned against quick unilateral moves in the yen, reminding investors of the government’s ability to intervene in currency markets.

data showed inflation rose slightly more than expected in September, although it was down from 10-month highs the previous month.

In recent weeks, the yen has been weakened by growing doubts about the Bank of Japan’s plans to further escalate interest rates. Japan’s fresh Prime Minister Shigeru Ishiba also said the economy cannot withstand further interest rate increases at this time.

Broader Asian currencies traded in a tight range. The Australian dollar pair rose 0.1%, paring some of its recent losses.

The South Korean won pair rose 0.2%, while the Singapore dollar pair was unchanged.

The Indian rupee pair remained close to its record highs from October.