Forex - USD/JPY rises after positive CSPI in Japan

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Investing.com - USD/JPY rose during morning Asian hours after a higher than expected corporate services price index data in Japan.

Released by Bank of Japan on Tuesday, December's year-on-year corporate service price index rose by 1.3% as against the expectation of a gain of 1.1%. The previous gain was 1.2%.

Australia's December NAB Business Confidence & Business Conditions was also released by the Conference Board and showed a rise of 0.2%. The previous reading showed a gain of 0.5% for business confidence.


Australian markets return after a long weekend and other markets from Singapore to China and Hong Kong and Taiwan are gearing up for the coming holiday weekend, with the marking of Lunar New Year on Friday, and market closures across many parts of the region.

USD/JPY rose 0.08% at 102.63, AUD/USD went up 0.03% at 0.8741 and NZD/USD fell 0.05% at 0.8228.

Meanwhile on Monday, U.S. dollar moved higher against most major currencies as expectations held firm the Federal Reserve will conclude a policy meeting this week by reducing its USD75 billion monthly bond-buying program though soft housing data watered down the greenback's gains.

The Federal Reserve will conclude a monetary policy meeting on Wednesday, and investors remained bullish on the greenback amid expectations that monetary authorities will make fresh cuts to its USD75 billion in monthly bond purchases due to several months of improving U.S. economic indicators.

Stimulus tools such as Fed purchases of Treasury holdings and mortgage debt suppress interest rates to spur recovery, thus weakening the dollar as long as they remain in effect, while talk of tapering the program strengthens the U.S. currency.

The Census Bureau reported earlier that sales of new, single-family houses in December came in at a seasonally adjusted annual rate of 414,000, missing market calls for a 475,000 reading and also below November's revised figure of 445,000, which softened the dollar.

The figure was still well above the December 2012 reading of 396,000, and the data also revealed that inventories remain lean and prices continue rising, which softened the report's bearish impacts on the dollar. Harsh winter weather may have affected sales in December as well.

Meanwhile in Europe, German research institute Ifo reported earlier that its business climate index rose to 110.6 in January, beating forecasts for a 110.0 reading and up from 109.5 in December, indicating that businesses in the euro zone's largest economy had a strong start to the year.

Also in Europe, the head of the eurogroup of finance ministers Jeroen Dijsselbloem said earlier that turmoil in emerging market economies won't affect the euro zone's recovery.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.01% at 80.57.

On Tuesday, the U.S. is to release data on durable goods orders, a leading indicator of production, as well as what will be a closely watch report on consumer confidence.

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This article appears in: Investing , Forex and Currencies

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