Investing.com - The dollar was trading close to six month highs against the yen on Tuesday after unexpectedly strong U.S. manufacturing data reinforced expectations that the Federal Reserve will soon start to roll back its stimulus program.
During late Asian trade, USD/JPY rose to highs of 103.37, the loftiest level since May 23 and was last up 0.22% to 103.15.
The pair was likely to find support at 102.82, the session low and resistance at 103.75.
The dollar was boosted after the Institute for Supply Management said Monday that manufacturing activity in the U.S. expanded at the fastest rate since April 2011 in November, fuelling optimism over the economic recovery.
The ISM manufacturing purchasing managers' index rose to 57.3 in November from 56.4 in October. Analysts had expected the index to fall to 55.0.
Expectations that the Bank of Japan will have to expand its stimulus program in order to meet its target of 2% inflation by 2015 continued to pressure the yen lower.
Speaking Monday, BoJ Governor Haruhiko Kuroda pledged to counter any new downside risks to the bank's inflation goal, saying the BoJ would act by "adjusting monetary policy without hesitation."
The euro traded up to five year highs against the yen, with EUR/JPY climbing 0.32% to 139.83, the highest level since October 2008.
Elsewhere, the euro edged higher against the dollar, with EUR/USD inching up 0.09% to 1.3552, from 1.3540 on Monday.
Investing.com offers an extensive set of professional tools for the financial markets.
Read more News on Investing.com and download the new Investing.com Stocks & Finance App for Android!
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.