Investing.com - The U.S. dollar fell against the Japanese yen in Asian trade Friday, as a rally on Wall Street and a new plan of action from European leaders to tackle the region’s debt were not enough to sway investors away from the Japanese currency.
In mid-day Asian trade USD/JPY hit 75.85, the daily low; the pair subsequently consolidated at 75.89, losing 0.16%.
The pair was likely to find short-term support at 75.65, the all-time low set on Thursday, and resistance at 77.45, the high of October 17.
On Thursday, Japan’s Finance Minister Jun Azumi vowed that Japan would take decisive action to prevent further excessive moves by the yen.
Also Thursday, the Bank of Japan announced plans for further monetary easing by expanding its asset purchase program by JPY5 trillion to JPY55 trillion, in an attempt to weaken the currency.
Also Thursday, the Bank of Japan announced plans for further monetary easing by expanding its asset purchase program by JPY5 trillion to JPY55 trillion, in an attempt to weaken the currency.
Meanwhile Friday, Japan’s Ministry of Economy, Trade and Industry reported that industrial production fell by 4% in September after a 0.8% gain in August. Economists had forecast a 2.1% for the period.
Separately, the Japanese Ministry of Internal Affairs said Friday that the nation’s unemployment rate eased down to 4.1% in September from 4.3% in August, outperforming market expectations of a 4.5% rate for the month.
Late Thursday, European leaders presented their long-awaited plan to address regional debt threats with an expansion of their rescue fund, and an agreement from private investors to take a 50% write-down in their holdings of Greek government debt.
Officials agreed to expand the European Financial Stability Facility to USD1.4 trillion by persuading bondholders to accrue losses on Greek debt as well a recapitalization of European banks. The deal includes the possibility of an enhanced role for the International Monetary Fund to strengthen the bailout fund.
Also Thursday, the U.S. Bureau of Economic Analysis reported that gross domestic product expanded by 2.5% in the third quarter, slightly above an anticipated 2.4% gain and the fastest pace since the third quarter of last year.
Separately, the U.S. Department of Labor said that the number of Americans filing for initial jobless benefits fell by 2,000 to a seasonally adjusted 402,000 for the week ending October 22.
Market expectations were for a decline to 400,000 for the week.
Wall Street shares rallied on the news from Europe and the surprising GDP numbers, as the Dow Jones Industrial Average gained 2.86%, the Nasdaq Composite Index surged 3.32%, and the S&P 500 leapt 3.43%.
Meanwhile, the yen moved higher against both the euro and the British pound with EUR/JPY down by 0.19% to hit 107.55, and GBP/JPY lower by 0.17% to hit 122.04.
The U.S. Bureau of Economic Analysis was scheduled to release its latest monthly report on consumer spending later Friday.