Investing.com - The dollar was lower against the yen on Friday as concerns over the outlook for global economic growth bolstered investor demand for the traditional safe haven yen.
USD/JPY was down 0.17% to 107.64 late Friday, not far from Thursday’s three week lows of 107.52. The pair ended the week with losses of 1.97%.
The US Dollar Index, which tracks the performance of the greenback against a basket of six major currencies, ended the week down 1% at 85.92. The move ended a 12-week rally that saw the index gain more than 8% since early July.
Market sentiment was hit by fears that Germany, the euro zone’s largest economy is being dragged into a recession after recent data indicated unexpected weakness in manufacturing and exports.
Steep declines in commodity-price declines also fuelled fears that the global economy is slowing. Brent crude prices fell to their lowest level in almost four years on Friday.
Earlier in the week, the International Monetary Fund cut its forecasts for global growth in 2014 and 2015 and warned that global growth may never reach its pre-crisis levels ever again.
The dollar fell to three week lows against the yen on Thursday after the minutes of the Federal Reserve’s September meeting showed that some officials were concerned over a slowdown in global growth and the impact of the stronger dollar on the U.S. inflation outlook.
"Some participants expressed concern that the persistent shortfall of economic growth and inflation in the euro area could lead to a further appreciation of the dollar and have adverse effects on the U.S. external sector," the minutes said.
The minutes prompted investors to trim back expectations for an earlier-than-expected hike in U.S. interest rates.
On Friday, Fed Vice Chairman Stanley Fischer said weaker-than-expected global growth could prompt it to slow the pace of eventual interest rate hikes.
Elsewhere, the euro fell to five week lows against the firmer yen on Friday, with EUR/JPY down 0.72% to 135.93 in late trade.
In the week ahead, investors will be awaiting U.S. data on retail sales and industrial production for fresh indications on the strength of the economic recovery. Markets in both the U.S. and Japan are closed for holidays on Monday.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Tuesday, as there are no relevant events on this day.
Monday, October 13
Markets in Japan are to remain closed for a national holiday.
Meanwhile, markets in the U.S. markets are to be closed for Columbus Day.
Wednesday, October 15
The U.S. is to release data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity. The country is also to report on producer prices and manufacturing activity in the New York region.
Thursday, October 16
The U.S. is to release the weekly report on initial jobless claims as well as data on industrial production and manufacturing activity in the Philadelphia region.
Friday, October 17
The U.S. is to round up the week with reports on building permits and housing starts, as well as a preliminary report on consumer sentiment.