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FXstreet.com (Barcelona) - The USD/JPY has been under great pressure today on Japan economy minister Amari's comments, saying that the JPY has depreciated to a level in line with fundamentals, and that further weakening could be harmful.

First, a strong plunge during the Asian shift down to 88.62 low, followed by the definitive loss of the 89.00 handle that send the pair to 88.29 daily low as the European morning ended. Then, the USD/JPY bounced, ahead and after the US data releases, to be capped at 88.94. Profit taking has taken the market back down to 88.70, for now.

The US NY empire state manufacturing improved from -8.10 to -7.78 in January, still negative unlike market consensus. US PPI eased more than expected in December, to 1.3% (YoY) - monthly contraction of -0.2%, with the "ex food and energy" dropping to 2.0% - monthly rise of 0.1%.

US November Business Inventories came down from 0.4% to 0.3%, as expected by market consensus, according to the US Census Bureau.

"The pair is in a process of testing 88.35 support area and I favor a reversal around these levels to initiate a rise towards 90.00", wrote Deltastock.com analyst Stoyan Mihaylov.

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