Investing.com - The U.S. dollar hit its highest level against the yen since June 2010 on Friday, amid expectations for more aggressive easing measures from the Bank of Japan after Japan’s government approved an emergency stimulus package.
USD/JPY hit 89.37 on Friday, the pair’s highest since June 28 2010; the pair subsequently consolidated at 89.15 by close of trade, 1.17% higher for the week.
The pair is likely to find support at 88.68, Friday’s low and resistance at 91.09, the high of June 22, 2010.
Japan's government, led by Prime Minister Shinzo Abe approved a USD117 billion emergency stimulus package on Friday and pledged to work more closely with the BoJ to combat deflation and spur growth.
The announcement fuelled speculation that the central bank will implement further easing measures at its upcoming policy meeting later this month.
The euro hit 20-months highs against the broadly weaker yen on Friday, with EUR/JPY rallying 0.98% to settle at 118.98.
The euro extended a rally that began on Thursday after the ECB kept interest rates unchanged at 0.75% and said a gradual economic recovery would begin this year, as structural reforms and actions by the bank to tackle the debt crisis continued to take effect.
The single currency had come under pressure ahead of the ECB meeting amid speculation that ECB President Mario Draghi could hint at possible rates cuts in the coming months.
The dollar was little changed on Friday after official data showed that the U.S. trade deficit widened unexpectedly in November, growing to USD48.7 billion, the biggest deficit since April. Imports climbed 3.8% to USD231.3 billion, while exports rose 1% to USD182.6 billion.
In the week ahead, market participants will be monitoring the yen closely to see how far its recent declines will extend.
Investors will be awaiting a speech by Federal Reserve Chairman Ben Bernanke on monetary policy and the recovery from the global financial crisis on Monday, as well as Tuesday’s data on U.S. retail sales for December.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, January 14
Markets in Japan will be closed for a national holiday.
In the U.S., Fed Chairman Ben Bernanke is to speak at the University of Michigan; his comments will be closely watched for any indications on the future possible direction of monetary policy.
Tuesday, January 15
The U.S. is to publish government data on retail sales, the leading indicator of consumer spending, which comprises the majority of economic activity, as well as official data on producer price inflation. In addition, the U.S. is to release data on manufacturing activity in New York state and a report on business inventories.
Wednesday, January 16
Japan is to release official data on core machinery orders, a leading indicator of production.
Later Wednesday, the U.S. is to produce government data on consumer inflation, in addition to data on industrial production and the capacity utilization rate. The country is also to publish official data on crude oil stockpiles, while the Fed is to publish its Beige Book, which looks at current economic conditions.
Thursday, January 17
Japan is release official data on tertiary industry activity, a leading indicator of economic activity.
Elsewhere, the U.S. was to produce official data on building permits, a leading indicator of future construction activity, as well as data on housing starts. The U.S. was also to release the weekly government report on initial jobless claims and data on manufacturing activity in Philadelphia.
Friday, January 18
The U.S. is to round up the week with preliminary data from the University of Michigan on consumer sentiment, a leading indicator of consumer spending.
USD/JPY hit 89.37 on Friday, the pair’s highest since June 28 2010; the pair subsequently consolidated at 89.15 by close of trade, 1.17% higher for the week.
The pair is likely to find support at 88.68, Friday’s low and resistance at 91.09, the high of June 22, 2010.
Japan's government, led by Prime Minister Shinzo Abe approved a USD117 billion emergency stimulus package on Friday and pledged to work more closely with the BoJ to combat deflation and spur growth.
The announcement fuelled speculation that the central bank will implement further easing measures at its upcoming policy meeting later this month.
The euro hit 20-months highs against the broadly weaker yen on Friday, with EUR/JPY rallying 0.98% to settle at 118.98.
The euro extended a rally that began on Thursday after the ECB kept interest rates unchanged at 0.75% and said a gradual economic recovery would begin this year, as structural reforms and actions by the bank to tackle the debt crisis continued to take effect.
The single currency had come under pressure ahead of the ECB meeting amid speculation that ECB President Mario Draghi could hint at possible rates cuts in the coming months.
The dollar was little changed on Friday after official data showed that the U.S. trade deficit widened unexpectedly in November, growing to USD48.7 billion, the biggest deficit since April. Imports climbed 3.8% to USD231.3 billion, while exports rose 1% to USD182.6 billion.
In the week ahead, market participants will be monitoring the yen closely to see how far its recent declines will extend.
Investors will be awaiting a speech by Federal Reserve Chairman Ben Bernanke on monetary policy and the recovery from the global financial crisis on Monday, as well as Tuesday’s data on U.S. retail sales for December.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, January 14
Markets in Japan will be closed for a national holiday.
In the U.S., Fed Chairman Ben Bernanke is to speak at the University of Michigan; his comments will be closely watched for any indications on the future possible direction of monetary policy.
Tuesday, January 15
The U.S. is to publish government data on retail sales, the leading indicator of consumer spending, which comprises the majority of economic activity, as well as official data on producer price inflation. In addition, the U.S. is to release data on manufacturing activity in New York state and a report on business inventories.
Wednesday, January 16
Japan is to release official data on core machinery orders, a leading indicator of production.
Later Wednesday, the U.S. is to produce government data on consumer inflation, in addition to data on industrial production and the capacity utilization rate. The country is also to publish official data on crude oil stockpiles, while the Fed is to publish its Beige Book, which looks at current economic conditions.
Thursday, January 17
Japan is release official data on tertiary industry activity, a leading indicator of economic activity.
Elsewhere, the U.S. was to produce official data on building permits, a leading indicator of future construction activity, as well as data on housing starts. The U.S. was also to release the weekly government report on initial jobless claims and data on manufacturing activity in Philadelphia.
Friday, January 18
The U.S. is to round up the week with preliminary data from the University of Michigan on consumer sentiment, a leading indicator of consumer spending.