Investing.com - The U.S. dollar is trading slightly higher against the Japanese yen during Wednesday’s Asian session ahead of a highly anticipated speech later in the session by Japanese Prime Minister Shinzo Abe.
In Asian trading Wednesday, USD/JPY rose 0.13% to 100.21 after earlier trading as high as 100.38. The pair is likely to find support at 100 and resistance in the 120 area.
The pair was supported on Tuesday after Japanese government sources told Reuters that Tokyo may direct public pension funds, which control the dollar-equivalent of USD2 trillion in assets, to increase investments in equities and overseas assets.
The news sparked demand for the greenback on sentiments investors will buy dollars to move investments out of Japan and into U.S. and other markets.
It is widely expected that in his speech today Abe will outline his plans for boosting Japanese incomes by 3%. Abe is also expected to propose new tax cuts aimed at bolstering growth in the world’s third-largest economy.
Abe has been pushing the Bank of Japan to get inflation to 2% within two years and while the central bank agreed to adopt that goal, some members recently voiced concern that it is too ambitious. Rising wages are seen as central to Abe’s plans to save Japan from deflationary pressure that have suppressed the economy there for two decades.
At a minimum, Abe needs to boost annual incomes by 2% to have a chance of 2% inflation being reached. While the yen has strengthened a bit recently, Japan bulls and yen bears still see Abe’s policies, to this point, has being positive.
Elsewhere, EUR/JPY inched up 0.05% to 130.97 while AUD/JPY fell 0.21% to 96.36. NZD/JPY rose 0.21% to 80.40.
In Asian trading Wednesday, USD/JPY rose 0.13% to 100.21 after earlier trading as high as 100.38. The pair is likely to find support at 100 and resistance in the 120 area.
The pair was supported on Tuesday after Japanese government sources told Reuters that Tokyo may direct public pension funds, which control the dollar-equivalent of USD2 trillion in assets, to increase investments in equities and overseas assets.
The news sparked demand for the greenback on sentiments investors will buy dollars to move investments out of Japan and into U.S. and other markets.
It is widely expected that in his speech today Abe will outline his plans for boosting Japanese incomes by 3%. Abe is also expected to propose new tax cuts aimed at bolstering growth in the world’s third-largest economy.
Abe has been pushing the Bank of Japan to get inflation to 2% within two years and while the central bank agreed to adopt that goal, some members recently voiced concern that it is too ambitious. Rising wages are seen as central to Abe’s plans to save Japan from deflationary pressure that have suppressed the economy there for two decades.
At a minimum, Abe needs to boost annual incomes by 2% to have a chance of 2% inflation being reached. While the yen has strengthened a bit recently, Japan bulls and yen bears still see Abe’s policies, to this point, has being positive.
Elsewhere, EUR/JPY inched up 0.05% to 130.97 while AUD/JPY fell 0.21% to 96.36. NZD/JPY rose 0.21% to 80.40.