Investing.com - The dollar moved higher against the yen on Friday, as upbeat data on U.S. consumer sentiment boosted the outlook for an early rate hike by the Federal Reserve.
USD/JPY was up 0.53% to 106.88 late Friday, from 106.32 on Thursday.
The pair is likely to find support at 106.12, Friday’s low and resistance at 107.65.
The dollar strengthened broadly after a report showed that the University of Michigan’s consumer sentiment index unexpectedly rose to 86.4 in October, the most since July 2007.
Another report showed that U.S. housing starts rose more than expected in September, bolstering the outlook for the sector.
The data reinforced expectations that the Fed will raise interest rates in the second half of 2015.
The US Dollar Index, which tracks the performance of the greenback against a basket of six major currencies, was up 0.33% to 85.31, but still ended the week lower, its second consecutive weekly decline.
The dollar fell against the other major currencies on Wednesday, touching a one month low against the yen amid a selloff sparked by fears that slower global growth would act as a drag on the U.S. economy.
Germany’s government cut its forecast for economic growth for this year and next on Tuesday, after recent data pointed to weakness in exports and industrial output.
The euro area’s largest economy now expects growth of 1.2% this year down from 1.8% previously and growth of 1.3% in 2015, down from 2%.
The euro edged higher against the yen on Friday, with EUR/JPY easing up 0.15% to 136.38 in late trade, off Thursday’s 11-month lows of 134.12.
On Thursday, European Central Bank official Ewald Nowotny said the bank still has leeway for more action to address slowing inflation in the euro area, but added that the euro zone economy did not need emergency measures.
In the week ahead, the U.S. is to release data on consumer inflation, as well as reports on both existing and new home sales, while Japan is to release trade data.
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 Monday, as there are no relevant events on this day.
Tuesday, October 21
The U.S. is to release private sector data on existing home sales.
Wednesday, October 22
Japan is to release a report on the trade balance.
The U.S. is to produce data on consumer price inflation, which comprises the majority of overall inflation.
Thursday, October 23
The U.S. is to publish its weekly report on initial jobless claims.
Friday, October 24
The U.S. is to round up the week with a report on new home sales.