For the 24 hours to 23:00 GMT, USD weakened 0.67% against the JPY and closed at 82.40, as speculation that Japanese companies are repatriating overseas earnings before fiscal year-end on March 31 boosted the Yen.
Yesterday, rating agency, Fitch, lowered its view on Japan’s 2012 economic growth outlook to 1.9% from its December forecast of 2.2% growth.
In the Asian session, at GMT0300, the pair is trading at 82.05, with the USD trading 0.43% lower from yesterday’s close.
The yen is trading higher after reports showed that Japan’s consumer prices rose in February, reducing the speculation for further easing by the central bank.
Data released in Japan showed that the Consumer Price Index increased 0.3% (YoY) in February compared to 0.1% growth in January, while manufacturing Purchasing Manager Index (PMI) rose to 51.1 in March compared to 50.5 in February. Separately, jobless rate in Japan fell to 4.5% in February, down from the market expectation of 4.6% rise. However industrial production unexpectedly fell 1.2% (MoM) in February, against the market expectation of 1.3% rise.
The pair is expected to find support at 81.68, and a fall through could take it to the next support level of 81.30. The pair is expected to find its first resistance at 82.58, and a rise through could take it to the next resistance level of 83.11.
Trading trends in the pair today are expected to be determined by the release of housing starts, construction orders and vehicle production data in the Japan.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
