Investing.com - The dollar softened against the yen on Monday after data revealed U.S. factory floors were a little less busy in November than markets were expecting.
In U.S. trading, USD/JPY was down 0.33% at 118.21, up from a session low of 117.88 and off a high of 119.14.
The pair was expected to test support at 117.22, Thursday's low, and resistance at 119.14, the session high.
The dollar has firmed against the yen in recent sessions as markets prepare for U.S. monetary policy to grow less accommodative while Japan moves in the opposition direction, though mixed U.S. manufacturing data allowed for Monday profit taking.
U.K.-based Markit Economics reported earlier that U.S. manufacturing activity in November expanded at its slowest pace since January, as new export orders fell.
The Markit U.S. manufacturing purchasing managers’ index ticked down to 54.8 in November from 55.9 in October. Economists had forecast a decline to 55.0.
Meanwhile in the U.S., the Institute of Supply Management reported earlier that its manufacturing PMI dipped to 58.7 from 59.0 in October, though still better than expectations of 57.9, though the dollar slid on profit taking anyway.
Losses were seen as limited, as any reading over 50 signifies expansion.
The yen rose on demand from bottom fishers after falling on news that Moody’s downgraded Japan's sovereign debt rating by one notch to A1, citing “heightened uncertainty” over Japan’s ability to cut its fiscal deficit following a decision by Prime Minister Shinzo Abe to delay a planned sales tax hike.
"Fiscal consolidation will become increasingly difficult to achieve as time passes given rising government spending, particularly for social programs associated with a rapidly ageing population," the rating agency said.
Separately, the yen was down slightly against the euro and down against the pound, with EUR/JPY up 0.01% at 147.69, and GBP/JPY trading up 0.36% at 186.16.