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Dollar extends gains against yen after U.S. data

Published 10/25/2012, 09:15 AM
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Investing.com - The U.S. dollar extended gains against the broadly weaker yen on Thursday, following upbeat U.S. data on durable goods and employment, while expectations for more easing by the Bank of Japan weighed on the yen.

In the early U.S. session, the dollar hit a fresh four-month high against the yen, with USD/JPY up 0.54% to 80.23.

The yen remained under broad selling pressure amid mounting speculation over the possibility of more easing by the BoJ at its upcoming policy meeting on October 30.

In the U.S. official data showed that durable goods orders, which includes transportation items, jumped by a seasonally adjusted 9.9% in September, compared to expectations for a 7.1% gain.

Excluding volatile transportation items durable goods orders rose by a seasonally adjusted 2.0% last month, beating expectations for a 0.8% gain.

Separately, the Labor Department said the number of people who filed for unemployment assistance in the U.S. last week fell to 369,000, from 392,000 the previous week, compared to expectations for a decrease to 370,000.

The greenback was close to session lows against the pound, with GBP/USD rising 0.59% to 1.6132.

Demand for the pound was boosted after official data showed that the U.K. economy expanded by 1.0% in the three months to September, pulling out of the longest double dip recession since 1955 and outstripping expectations for a 0.6% gain.

The greenback was little changed against the euro and the Swiss franc, with EUR/USD inching up 0.02% to 1.2975 and USD/CHF dipping 0.02% to 0.9321.

Sentiment on the single currency remained fragile as investors awaited any indication that Spain is moving closer to formally requesting a bailout from its euro zone partners and activating the European Central Bank’s bond purchasing plan.

The greenback was broadly lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD down 0.18% to 0.9916, AUD/USD climbing 0.40% to 1.0384 and NZD/USD rising 0.39% to 0.8235.

Earlier Thursday, the Reserve Bank of New Zealand kept its benchmark interest rate unchanged at 2.5%, marking Governor Graeme Wheeler's first decision as head of the central bank, after replacing Alan Bollard in late September.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, inched down 0.02% to 79.98.

Later Thursday, the U.S. was to release official data on pending home sales.


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