Forex - USD/JPY slips on profit-taking, hovers close 6-1/2 month high

Investing.com - The U.S. dollar edged lower against the yen on Friday, as investors locked in profits after the pair rallied to a six-and-a-half month high on Thursday, while pressures for further easing measures by the Bank of Japan continued to weigh on demand for the yen.

USD/JPY hit 80.90 during European morning trade, the daily low; the pair subsequently consolidated at 80.97, slipping 0.24%.

The pair was likely to find support at 80.12, Thursday's low and resistance at 81.45, Thursday's high and a six-and-a-half month high.

The yen remained under pressure after Japan's main opposition leader from the Liberal Democratic Party (LDP) and possible next prime minister, Shinzo Abe, earlier said that the upcoming election would be about which party could boost a stagnant economy.

The LDP has vowed to do its utmost to beat deflation and the strong yen, seeking a 2% inflation target and calling for a revision of the law to boost cooperation between the government and central bank.

Japan dissolved parliament's lower house on Friday for a December 16 election that is likely to return the long-dominant Liberal Democratic Party (LDP) to power with a conservative former prime minister at the helm.

Meanwhile, investors remained concerned over the looming "fiscal cliff" in the U.S., approximately USD600 billion in automatic tax hikes and spending cuts due to come into effect on January 1.

There are fears the U.S. economy will fall back into a recession, unless a divided Congress and the White House can work out a compromise before then.

The yen was higher against the euro with EUR/JPY shedding 0.47%, to hit 103.26.

Later in the day, the U.S. was to produce official data on the capacity utilization rate and industrial production, as well as a report on the balance of domestic and foreign securities purchases.