USDJPY Movement
For the 24 hours to 23:00 GMT, the USD soared 1.20% against the JPY and closed at 99.58. The Japanese Yen came under pressure, amid signs that the Prime Minister, Shinzo Abe is progressing on policies that would weaken the currency further. Shinzo Abe got backing for a sales-tax increase from panels that urged an increase in stimulus to cushion the economic blow.
The yen also dropped as reports showed manufacturing in China and Europe expanded and the threat of imminent military action against Syria eased, damping demand for safe haven Yen.
In economic news, vehicle sales in Japan declined 6.4% (YoY) in August following a 13.5% drop registered in the previous month.
In the Asian session, at GMT0300, the pair is trading at 99.51, with the USD trading marginally lower from yesterday’s close. Early morning, the Bank of Japan reported that its monetary base increased 42.0% (YoY), more than the analysts’ consensus for a 41.3% rise and compared to a 38.0% increase registered in the earlier month. Another official report showed that labour cash earning in Japan advanced 0.4% (YoY) in July, compared to a 0.6% rise registered in the previous month.
The pair is expected to find support at 98.78, and a fall through could take it to the next support level of 98.04. The pair is expected to find its first resistance at 99.98, and a rise through could take it to the next resistance level of 100.45.
Amid lack of major economic releases in Japan, investors are expected to keep a close watch on global economic news for further direction.
The currency pair is showing convergence with its 20 Hr moving average and is trading above its 50 Hr moving average.
