Investing.com - The U.S. dollar rose to one-week highs against the yen in light trade on Monday, as sentiment on the greenback remained broadly supported by expectations for a U.S. rate hike next year and as concerns over the recent drop in oil prices began to ease.
Trading volumes were expected to remain thin this week with many investors away for the Christmas holiday and ahead of the New Year's holiday.
USD/JPY hit 119.89 during European early afternoon trade, the pair's highest since December 10; the pair subsequently consolidated at 119.81, rising 0.30%.
The pair was likely to find support at 118.23, the low of December 18 and resistance at 121.00, the high of December 9.
The dollar remained broadly supported after the Federal Reserve signaled last week that it was on track to raise interest rates next year but said it was taking a patient stance.
The central bank also acknowledged the improvement in the U.S. labor market and noted that the economy is making progress toward its goals in inflation and employment.
Earlier Monday, the Bank of Japan said, in its Monthly Report on Recent Economic and Financial Developments, that the country's economy has continued to recover moderatel, as the effects of the decline in demand following the sales tax hike have been subsiding.
At the conclusion of its monthly policy meeting last Friday, the BoJ maintained the annual pace of increase in the monetary base at about ¥80 trillion.
The safe haven yen had rallied earlier last week in the wake of a rout in oil prices, which had added to fears over the global economic outlook and the impact of oil’s drop on weakening emerging market economies and their currencies.
The yen was lower against the euro, with EUR/JPY gaining 0.57% to 146.92.
Later in the day, the U.S. was to release on existing home sales.