Investing.com - The dollar strengthened against the yen on Thursday despite Federal Reserve Chair Nominee Janet Yellen's somewhat dovish testimony before Congress, as Japan's Finance Minister said currency interventions remain a necessary tool to stabilize markets.
In U.S. trading on Thursday, USD/JPY was trading at 100.02, up 0.79%, up from a session low of 99.14 and off a high of 100.14.
The pair was likely to find support at 99.11, Wednesday's low, and resistance at 100.61, the high from Sept. 11.
The dollar softened against other currencies after Yellen told the Senate Banking Committee that the U.S. central bank's USD85 billion in monthly bond purchases have and will continue to support the economy until more sustained recovery becomes evident.
"We have made good progress, but we have farther to go to regain the ground lost in the crisis and the recession," Yellen said.
"Unemployment is down from a peak of 10 percent, but at 7.3 percent in October, it is still too high, reflecting a labor market and economy performing far short of their potential. At the same time, inflation has been running below the Federal Reserve's goal of 2 percent and is expected to continue to do so for some time."
Monetary stimulus tools such as monthly bond purchases aim to spur recovery by driving down long-term interest rates, weakening the dollar in the process.
The dollar also came off earlier highs amid sentiments that even when the Fed begins to taper the pace of its monthly asset purchases be it in December or in early 2014, monetary tightening is still a long way away.
The yen, however, slumped against most major currencies after Japanese Finance Minister Taro Aso said Japan should maintain currency market interventions as policy tools to use when excess volatility roils markets.
Elsewhere in the U.S., the Labor Department reported earlier that the number of individuals filing for initial jobless benefits last week declined by 2,000 to a seasonally adjusted 339,000.
Analysts had expected U.S. jobless claims to fall by 11,000, which also softened the dollar.
A separate report showed that the U.S. trade deficit widened to USD41.8 billion in September from a deficit of USD38.7 billion in August.
Analysts were expecting a USD39.0 billion deficit.
The yen was down against the pound and down against the euro, with GBP/JPY up 0.85% and trading at 160.70 and EUR/JPY trading up 0.59% at 134.62.
On Friday, the U.S. is to round up the week with data on manufacturing activity in the New York region, as well as reports on industrial production and import prices.
In U.S. trading on Thursday, USD/JPY was trading at 100.02, up 0.79%, up from a session low of 99.14 and off a high of 100.14.
The pair was likely to find support at 99.11, Wednesday's low, and resistance at 100.61, the high from Sept. 11.
The dollar softened against other currencies after Yellen told the Senate Banking Committee that the U.S. central bank's USD85 billion in monthly bond purchases have and will continue to support the economy until more sustained recovery becomes evident.
"We have made good progress, but we have farther to go to regain the ground lost in the crisis and the recession," Yellen said.
"Unemployment is down from a peak of 10 percent, but at 7.3 percent in October, it is still too high, reflecting a labor market and economy performing far short of their potential. At the same time, inflation has been running below the Federal Reserve's goal of 2 percent and is expected to continue to do so for some time."
Monetary stimulus tools such as monthly bond purchases aim to spur recovery by driving down long-term interest rates, weakening the dollar in the process.
The dollar also came off earlier highs amid sentiments that even when the Fed begins to taper the pace of its monthly asset purchases be it in December or in early 2014, monetary tightening is still a long way away.
The yen, however, slumped against most major currencies after Japanese Finance Minister Taro Aso said Japan should maintain currency market interventions as policy tools to use when excess volatility roils markets.
Elsewhere in the U.S., the Labor Department reported earlier that the number of individuals filing for initial jobless benefits last week declined by 2,000 to a seasonally adjusted 339,000.
Analysts had expected U.S. jobless claims to fall by 11,000, which also softened the dollar.
A separate report showed that the U.S. trade deficit widened to USD41.8 billion in September from a deficit of USD38.7 billion in August.
Analysts were expecting a USD39.0 billion deficit.
The yen was down against the pound and down against the euro, with GBP/JPY up 0.85% and trading at 160.70 and EUR/JPY trading up 0.59% at 134.62.
On Friday, the U.S. is to round up the week with data on manufacturing activity in the New York region, as well as reports on industrial production and import prices.