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Forex - USD/JPY slightly higher after trade deficit report

Published 05/21/2013, 09:28 PM
Updated 05/21/2013, 09:29 PM
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Investing.com - The U.S. dollar traded modestly higher against the Japanese yen during Wednesday’s Asian session following the release of Japan’s trade deficit data for April.

In Asian trading Wednesday, USD/JPY inched up 0.07% to 102.58. The pair was likely to find support at 102.06, the session low and resistance at 103.00.

Earlier Wednesday, Japan’s Finance Ministry said the country’s trade deficit widened to a larger-than-expected 879.9 billion yen in April. Exports rose 3.8% to 5.78 trillion yen, but imports increased 9.4% to 6.66 trillion yen.

While the weaker yen has been helping Japanese exporters, the trade deficit data could be a sign that the government needs to tread carefully regarding allowing the yen to fall much further. The weak yen raised the prices of imports of crude oil, gas and other commodities that Japan is short of.

Earlier this week, Japanese finance minister Akira Amari said many believed the yen’s correction from excessive strength was almost over and warned that further yen weakness could have a negative impact on the country’s economy.

The U.S. was Japan’s largest export market last month. Japan had a trade surplus with the U.S. of USD5.5 billion at the end of April.

The Bank of Japan kicked off a two-day meeting Tuesday and most traders export the central bank will stick with current monetary policy. The meeting will be followed by press briefing by BoJ Governor Haruhiko Kuroda.

Meanwhile, EUR/JPY rose 0.24% to 132.59 while AUD/JPY fell 0.08% to 100.44. NZD/JPY inched down 0.05% to 83.70.


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