Forex - EUR/JPY hits 7-day high after weak Japan data

Published 12/08/2010, 09:35 AM
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Investing.com – The euro was up against the yen on Wednesday, advancing to a 7-day high after official data showed that Japanese core machinery orders fell unexpectedly in October, declining for the second straight month.

EUR/JPY hit 111.22 during European afternoon trade, the pair’s highest since November 29; the pair subsequently consolidated at 111.12, gaining 0.37%.

The pair was likely to find support at 109.55, Monday’s low and resistance at 111.76, the high of November 29.

Earlier in the day, the Cabinet Office said factory orders fell 1.4% from September, when they dropped 10.3%, the biggest slide since March 2008. Analysts had expected core machinery orders to be flat in October.

The report added to signs that the nation’s export-led recovery is stalling as the yen sharp gains against the U.S. dollar this year impacted on exporters’ earnings and competitiveness abroad.

Meanwhile, the euro was down against the U.S. dollar, with EUR/USD shedding 0.23% to hit 1.3233.

On Tuesday, Ireland moved closer to securing an EUR85 billion international bailout package after the austerity budget passed the first in a series of votes to tackle what Finance Minister Brian Lenihan called the “worst crisis in our history.”

However fears remained over the divide among euro-zone countries on how best to provide a more long-term solution to the region's sovereign debt problems.

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