Forex - USD/JPY gains on weak U.S. data, talk of Japanese easing

Published 11/16/2012, 03:09 PM
Updated 11/16/2012, 03:10 PM
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Investing.com - The dollar strengthened against the yen on Friday after soft industrial production figures published in the U.S., wiping out demand for riskier assets and sent investors chasing the safe-haven dollar.

In U.S. trading on Friday, USD/JPY was trading at 81.23, up 0.08%, up from a session low of 80.90 and off a high of 81.44.

The pair was likely to find support at 80.90, the earlier low, and resistance at 81.44, the earlier high.

U.S. industrial production fell unexpectedly in October, the Federal Reserve reported Friday.

Industrial production fell 0.4% following a gain of 0.2% in September, whose figure was revised down from 0.4%.

Analysts had expected industrial production to rise 0.2% in October, and the disappointment sparked a risk-off trading session that fueled dollar demand.

Superstorm Sandy disrupted business for a good chunk of the northeastern U.S. last month, which reflected in the numbers.

A separate report showed that the U.S. capacity utilization rate declined to 77.8% in October from 78.2% in September, missing expectations for an increase to 78.3%.

Weak U.S. indicators often send the dollar gaining as investors sell stocks for profits.

Meanwhile in Japan, sentiments that opposition leader Shinzo Abe may become the country's next prime minister weakened the yen.

Shinzo has said he favors more monetary stimulus to jolt the Japanese economy.

The yen, meanwhile was down against the pound and up against the euro, with GBP/JPY up 0.20% and trading at 129.04 and EUR/JPY trading down 0.33% at 103.39.









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