Investing.com - The U.S. dollar hit its highest level against
the yen since June 2010 on Friday, amid expectations for more
aggressive easing measures from the Bank of Japan after Japan's
government approved an emergency stimulus package.
USD/JPY hit 89.37 on Friday, the pair's highest since June 28 2010;
the pair subsequently consolidated at 89.15 by close of trade,
1.17% higher for the week.
The pair is likely to find support at 88.68, Friday's low and
resistance at 91.09, the high of June 22, 2010.
Japan's government, led by Prime Minister Shinzo Abe approved a
USD117 billion emergency stimulus package on Friday and pledged to
work more closely with the BoJ to combat deflation and spur growth.
The announcement fuelled speculation that the central bank will
implement further easing measures at its upcoming policy meeting
later this month.
The euro hit 20-months highs against the broadly weaker yen on
Friday, with EUR/JPY rallying 0.98% to settle at 118.98.
The euro extended a rally that began on Thursday after the ECB kept
interest rates unchanged at 0.75% and said a gradual economic
recovery would begin this year, as structural reforms and actions
by the bank to tackle the debt crisis continued to take effect.
The single currency had come under pressure ahead of the ECB
meeting amid speculation that ECB President Mario Draghi could hint
at possible rates cuts in the coming months.
The dollar was little changed on Friday after official data showed
that the U.S. trade deficit widened unexpectedly in November,
growing to USD48.7 billion, the biggest deficit since April.
Imports climbed 3.8% to USD231.3 billion, while exports rose 1% to
In the week ahead, market participants will be monitoring the yen
closely to see how far its recent declines will extend.
Investors will be awaiting a speech by Federal Reserve Chairman Ben
Bernanke on monetary policy and the recovery from the global
financial crisis on Monday, as well as Tuesday's data on U.S.
retail sales for December.
Ahead of the coming week, Investing.com has compiled a list of
these and other significant events likely to affect the markets.
Monday, January 14
Markets in Japan will be closed for a national holiday.
In the U.S., Fed Chairman Ben Bernanke is to speak at the
University of Michigan; his comments will be closely watched for
any indications on the future possible direction of monetary
Tuesday, January 15
The U.S. is to publish government data on retail sales, the leading
indicator of consumer spending, which comprises the majority of
economic activity, as well as official data on producer price
inflation. In addition, the U.S. is to release data on
manufacturing activity in New York state and a report on business
Wednesday, January 16
Japan is to release official data on core machinery orders, a
leading indicator of production.
Later Wednesday, the U.S. is to produce government data on consumer
inflation, in addition to data on industrial production and the
capacity utilization rate. The country is also to publish official
data on crude oil stockpiles, while the Fed is to publish its Beige
Book, which looks at current economic conditions.
Thursday, January 17
Japan is release official data on tertiary industry activity, a
leading indicator of economic activity.
Elsewhere, the U.S. was to produce official data on building
permits, a leading indicator of future construction activity, as
well as data on housing starts. The U.S. was also to release the
weekly government report on initial jobless claims and data on
manufacturing activity in Philadelphia.
Friday, January 18
The U.S. is to round up the week with preliminary data from the
University of Michigan on consumer sentiment, a leading indicator
of consumer spending.
offers an extensive set of professional tools for the Forex,
Commodities, Futures and the Stock Market including real-time data
streaming, a comprehensive economic calendar, as well as financial
news and technical & fundamental analysis by in-house experts.
Read more News on Investing.com or Follow us on Twitter at @