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Forex - USD/JPY hits 7-week high after Korean shelling

Published 11/23/2010, 03:48 AM
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Investing.com – The U.S. dollar was up against the yen on Tuesday, advancing to a 7-week high after a major artillery exchange on the Korean peninsula and ongoing fears over euro zone sovereign debt sapped risk appetite.

USD/JPY hit 83.84 during early European trade, the pair’s highest since October 5; the pair subsequently consolidated at 83.65, gaining 0.39%.

The pair was likely to find support at 82.39, the low of November 15 and resistance at 84.33, the high of September 28.

Earlier in the day, media outlets in Seoul reported that North Korean artillery fired dozens of shells onto a South Korean island near the disputed sea border, prompting a return of fire by the South.

Elsewhere, Irish political turmoil fuelled fears that the crisis which already engulfed Greece would spread to other indebted euro zone nations, such as Spain or Portugal.

Speculation that China is to introduce further monetary tightening measures to curb inflation also weighed.

Meanwhile, the yen was up against the euro, with EUR/JPY shedding 0.07% to hit 113.47.

Later Tuesday, the U.S. was to publish revised figures on third quarter GDP as well as data on existing home sales and manufacturing. In addition, the Federal Reserve was to publish the minutes of its November monetary policy meeting while the governor of the Bank of Japan was to speak at a public engagement.

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