Investing.com - The U.S. dollar edged lower against the yen on Wednesday, amid ongoing fears over the sovereign debt crisis in the euro zone, while speculation that the Bank of Japan will not announce further easing measures this week supported the yen.
USD/JPY hit 79.25 during early European trade, the daily low; the pair subsequently consolidated at 79.35, edging down 0.09%.
The pair was likely to find support at 78.98, the low of May 18 and resistance at 79.69, the high of June 20.
Market sentiment came under pressure after the German Constitutional Court delayed on Tuesday its decision on whether the euro zone's bailout fund, the European Stability Mechanism, and planned changes to the region's budget rules are compatible with German law.
The court said a decision could take months rather than weeks due to the complexity of the ruling. Without German backing, the ESM, which was originally meant to start on July 1, then delayed to July 9, cannot come into effect.
Monday’s meeting of euro zone finance ministers also weighed on investor confidence. While the ministers agreed to grant Spain an extra year through 2014 to reach its deficit reduction targets, they did not come up with a final figure for aid for the country's ailing banks but said some 30 billion euros would be available by the end of this month.
Markets were eyeing the minutes of the Federal Reserve’s most recent policy meeting to be published later in the day, amid speculation that the central bank may implement further monetary easing measures to shore up growth.
Meanwhile, expectations that the BoJ will hold back from announcing more monetary easing at this week’s policy meeting lent support to the yen.
Elsewhere, the yen was steady against the euro with EUR/JPY easing 0.01%, to hit 97.29.
Later in the day, the U.S. was to release official data on trade balance and crude oil stockpiles, followed by the minutes of the Fed’s June policy-setting meeting.
USD/JPY hit 79.25 during early European trade, the daily low; the pair subsequently consolidated at 79.35, edging down 0.09%.
The pair was likely to find support at 78.98, the low of May 18 and resistance at 79.69, the high of June 20.
Market sentiment came under pressure after the German Constitutional Court delayed on Tuesday its decision on whether the euro zone's bailout fund, the European Stability Mechanism, and planned changes to the region's budget rules are compatible with German law.
The court said a decision could take months rather than weeks due to the complexity of the ruling. Without German backing, the ESM, which was originally meant to start on July 1, then delayed to July 9, cannot come into effect.
Monday’s meeting of euro zone finance ministers also weighed on investor confidence. While the ministers agreed to grant Spain an extra year through 2014 to reach its deficit reduction targets, they did not come up with a final figure for aid for the country's ailing banks but said some 30 billion euros would be available by the end of this month.
Markets were eyeing the minutes of the Federal Reserve’s most recent policy meeting to be published later in the day, amid speculation that the central bank may implement further monetary easing measures to shore up growth.
Meanwhile, expectations that the BoJ will hold back from announcing more monetary easing at this week’s policy meeting lent support to the yen.
Elsewhere, the yen was steady against the euro with EUR/JPY easing 0.01%, to hit 97.29.
Later in the day, the U.S. was to release official data on trade balance and crude oil stockpiles, followed by the minutes of the Fed’s June policy-setting meeting.