The Japanese yen weakened against its major rivals in the European session on Thursday amid safe-haven status, as investors took inflation concerns in their stride.

Strong earnings and indications of central banks adopting a patient approach to inflationary pressures supported the mood.

News that the Japanese government is planning to approve a larger stimulus package than market estimates cheered investors. The government is set to approve the package worth 55.7 trillion yen to mitigate the impact of the coronavirus pandemic.

Widening interest rate differentials between treasuries and JGBs also contributed to a sell-off in the currency.

While the Fed is forecast to raise rates by next year, the BOJ is seen maintaining its accommodative stance to support economic growth.

The yen dropped to 123.24 against the franc, 129.57 against the euro and 154.27 against the pound, off its early highs of 122.78 and 129.05 and a 2-day high of 153.71, respectively. If the yen extends decline, 126.00, 132.00 and 157.00 are possibly seen as its next support levels against the franc, the euro and the pound, respectively.

The yen retreated to 80.53 against the kiwi, 90.66 against the loonie and 83.26 against the aussie, following its prior session's high of 79.75, more than 5-week highs of 90.23 and 82.68, respectively. The yen is seen finding support around 82.00 against the kiwi, 92.00 against the loonie and 86.00 against the aussie.

The yen remained lower at 114.23 against the greenback, after rising to a 3-day high of 113.88 in the Asian session. At yesterday's close, the pair was worth 114.08.

Looking ahead, U.S. weekly jobless claims for the week ended November 13 and leading index for October will be published in the New York session.

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