Investing.com - The euro was higher against the yen on Tuesday, but gains were limited as sentiment was hit by the downgrade of six European countries and disappointing U.S. retail sales data.
EUR/JPY hit 103.17 during European afternoon trade, the daily high; the pair subsequently consolidated at 102.73, advancing 0.41%.
The pair was likely to find support at 101.64, the low of February 8 and resistance at 103.45, the high of November 24.
Ratings agency Moody's downgraded the credit ratings on six European countries earlier, including Spain and Italy late Monday. France and Austria kept their top ratings but had their outlooks dropped to "negative" from "stable."
Moody's also cut its ratings on Portugal, Slovakia, Slovenia and Malta, while warning that it could downgrade the U.K., rekindling contagion worries.
Sentiment was also hit after official data showed that U.S. retail sales rose less-than-expected in January, while December’s figure was revised down to a flat reading.
Meanwhile, the yen remained under pressure after the Bank of Japan eased policy earlier by adding JPY10 trillion to its asset-purchase program. The bank also set a 1% inflation target “for the time being” and stated that positive consumer-price growth would be defined as below 2% year-on-year.
Following the decision, Bank of Japan Governor Masaaki Shirakawa said that Japan's economy is headed towards a moderate recovery but the outlook remains highly uncertain.
The yen was sharply lower against the U.S. dollar with USD/JPY climbing 0.68, to hit 78.10.
Sentiment briefly strengthened earlier after a report showed that German economic sentiment rose significantly more-than-expected in February, turning positive for the first time since May 2011.
Economic sentiment in the euro zone also rose in February to minus 8.1 from minus 32.5 in January.
EUR/JPY hit 103.17 during European afternoon trade, the daily high; the pair subsequently consolidated at 102.73, advancing 0.41%.
The pair was likely to find support at 101.64, the low of February 8 and resistance at 103.45, the high of November 24.
Ratings agency Moody's downgraded the credit ratings on six European countries earlier, including Spain and Italy late Monday. France and Austria kept their top ratings but had their outlooks dropped to "negative" from "stable."
Moody's also cut its ratings on Portugal, Slovakia, Slovenia and Malta, while warning that it could downgrade the U.K., rekindling contagion worries.
Sentiment was also hit after official data showed that U.S. retail sales rose less-than-expected in January, while December’s figure was revised down to a flat reading.
Meanwhile, the yen remained under pressure after the Bank of Japan eased policy earlier by adding JPY10 trillion to its asset-purchase program. The bank also set a 1% inflation target “for the time being” and stated that positive consumer-price growth would be defined as below 2% year-on-year.
Following the decision, Bank of Japan Governor Masaaki Shirakawa said that Japan's economy is headed towards a moderate recovery but the outlook remains highly uncertain.
The yen was sharply lower against the U.S. dollar with USD/JPY climbing 0.68, to hit 78.10.
Sentiment briefly strengthened earlier after a report showed that German economic sentiment rose significantly more-than-expected in February, turning positive for the first time since May 2011.
Economic sentiment in the euro zone also rose in February to minus 8.1 from minus 32.5 in January.