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Forex - USD/JPY edges lower but still near 2-1/2 year high

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Investing.com - The U.S. dollar edged lower against the yen on Thursday, but the pair was still trading close to a two-and-a-half year high, supported by the announcement of a U.S. budget deal slated to avoid the country a fiscal crisis.

USD/JPY hit 87.09 during European morning trade, the session low; the pair subsequently consolidated at 87.20, slipping 0.16%.

The pair was likely to find support at 86.54, Wednesday's low and resistance at 87.35, Thurday's high.

Market sentiment strengthened on Wednesday after U.S. lawmakers passed a compromise bill to avoid the fiscal cliff, blocking a series of looming tax increases and spending cuts that could have pushed the U.S. economy back into a recession.

However, investors remained jittery over the longer term outlook, with negotiations on raising the U.S. debt ceiling still to come in February.

Meanwhile, sentiment on the yen remained fragile amid ongoing expectations for further easing measures by the Bank of Japan.

The yen was higher against the euro with EUR/JPY dropping 0.42%, to hit 114.70.

Also Thursday, Spain's Employment Ministry said the number of unemployed people fell by a seasonally adjusted 59,100 in December, defying expectations for an increase of 50,300.

The number of unemployed people in Spain rose by an unrevised 74,300 in November.

Later in the day, the U.S. was to release a report on ADP nonfarm payrolls, as well as its weekly government report on initial jobless claims. In addition, the Federal Reserve was to publish the minutes of its most recent policy-setting meeting.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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