A gauge of major currency volatility fell to the lowest level in more than two weeks before Federal Reserve Chairman Janet Yellen gives her first monetary-policy report to Congress tomorrow as the central bank weighs the pace of the economy and additional cuts to its monthly bond-buying.

The yen rose versus most of its 16 major counterparts even as the Ministry of Finance said the nation’s current-account deficit widened to a record. Norway’s krone jumped the most in three weeks against the euro after inflation quickened. The Australian dollar fell as Toyota Motor Corp. said it will stop building cars there in 2017. Hungary’s forint and South Africa’s rand led losses among emerging-market currencies.

“Focus this week will be very much on Janet Yellen’s first round of congressional testimony as Fed Chairman,” Robert Lynch, a currency strategist at HSBC Holdings Plc in New York, wrote in a client note. Yellen’s limited comments in recent months “suggest she favors the more gradual pace of tapering currently in place and can easily point to the recent softening in the jobs data and some other economic indicators to support her view.”

The JPMorgan G7 Volatility Index fell to 7.82 percent at 12:36 p.m. in New York, the lowest level on a closing basis since Jan. 22.

The yen gained 0.1 percent to 102.18 per dollar after sliding to 102.64, the weakest level since Jan. 31. Japan’s currency rose 0.1 percent to 139.41 per euro after dropping 1.6 percent during the previous two days. The euro added 0.1 percent to $1.3642.

Emerging Markets

An index of emerging-market currencies compiled by Bloomberg dropped 0.1 percent after rising 0.8 percent last week. The forint weakened 1.1 percent to 228.14 per dollar and the rand slid 0.7 percent to 11.1393.

Brazil’s real declined for the first time in five days as a drop in commodities reduced demand for the currencies of raw- material exporters. The currency depreciated 0.8 percent to 2.3989 per dollar.

Benchmark 10-year yields traded at almost the lowest level in three months as investors waited to see whether Yellen, who was sworn in as the central-bank head on Feb. 3, will acknowledge the recovery in the labor market is slowing. The Fed announced in December and January it would trim its bond purchases by $10 billion a month to $65 billion amid signs of economic growth.

U.S. employers added 113,000 workers last month, the Labor Department said on Feb. 7, a second month of gains that were less than the forecast projected by Bloomberg News surveys of economists.

Fed View

“The FOMC’s broader commitment to gradual tapering and an extended period of low policy rates should be the broader take- away for EM currencies,” HSBC’s Lynch said. “Not only should downside risks to EM currencies be limited, but a reiteration of the Fed’s still-dovish policy stance may even provide some degree of support.”

The yen has appreciated 4.2 percent this year, after sliding 17 percent in 2013, according to Bloomberg Correlation- Weighted Indexes that track 10 developed-nation currencies. The euro dropped 0.1 percent since Dec. 31, while the dollar gained 0.7 percent.

Japan’s current-account deficit, the broadest measure of trade, widened to 638.6 billion yen, the most in data going back to 1985, according to the finance ministry report. Overseas investors cut their holdings of the nation’s bonds by 1.26 trillion yen in the final month of last year, the most since September, the data showed.

Krone Gains

The krone strengthened for a second day against the euro after Statistics Norway said consumer prices rose 2.3 percent in January from a year earlier, after increasing 2 percent in December. Economists surveyed by Bloomberg news predicted an increase of 2 percent.

Norway’s currency rallied 0.6 percent to 8.3701 per euro, the biggest gain since Jan. 17, and advanced 0.7 percent to 6.1333 per dollar.

Australia’s unemployment rate climbed to 5.9 percent last month, the highest since June 2009, according to a Bloomberg survey before the statistics bureau report on Thursday.

The Aussie weakened 0.2 percent to 89.42 U.S. cents after appreciating to 89.99 cents on Feb. 7, the strongest level since Jan. 14.

“There are two currencies that have really moved,” Marc Chandler, a currency strategist in New York at Brown Brothers Harriman & Co., said in a phone interview. “One is Norway, on the back of stronger-than-expected inflation numbers, and the other currency that’s moved is the Aussie, and that’s primarily correcting last week’s gains, but also on the back of Toyota saying it’s cutting production by 2017.”