By Rocky Swift

TOKYO (Reuters) -The yen edged lower on Friday, trimming its sharpest weekly gain in more than four months, as traders considered the impact of potential rate increases by the Bank of Japan and a leadership election this weekend.

BOJ Governor Kazuo Ueda reiterated that the central bank would continue raising interest rates if the economy and prices move in line with its forecast. Markets are also focused on a Liberal Democratic Party election on Saturday that will determine Japan’s next prime minister.

The dollar rebounded overnight despite a closure of the U.S. government that has halted the publication of key economic data, including the closely watched monthly jobs report for September that was due to be released on Friday. Canada’s currency held near a four-month low

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