Investing.com - The dollar touched one-week highs against the yen on Friday after a senior Federal Reserve official indicated that the bank could start to reduce its stimulus program in October.
St. Louis Federal Reserve President James Bullard said the decision not to taper in September was “close” and did not rule out a small reduction in the central bank's bond purchases in October. The comments came during an interview with Bloomberg television.
USD/JPY hit session highs of 99.67 following the comments, before settling at 99.36, dipping 0.08%. The pair ended the week 0.27% higher, after falling to three-week lows of 97.75 on Wednesday.
The pair is likely to find support at 97.75 and resistance at 99.98, the high of September 12.
The dollar dropped to three-week lows against the yen on Wednesday after the Federal Reserve said it wanted to see more evidence of a sustained economic recovery before it adjusted the scale of its bond buying program.
The decision surprised markets, which had been expecting the Fed to cut its USD85 billion-a-month stimulus program by USD10 billion to USD15 billion.
In a press conference following the Fed statement, Chairman Ben Bernanke reiterated that the plan to taper asset purchases was never a "preset course," and added that the bank's decision was dependent on how the economic recovery continues to progress.
The central bank also said it will keep interest rates on hold at record low levels until the unemployment rate falls to around 6.5%, as long as inflation doesn't accelerate beyond 2.5% a year.
In the week ahead, uncertainty over the direction of Federal Reserve policy and the decision over Chairman Ben Bernanke’s eventual successor look likely to weigh on the dollar. Meanwhile, markets in Japan are to remain closed for a holiday on Monday.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, September 23
Markets in Japan are to remain closed for a national holiday.
Tuesday, September 24
The U.S. is to release private sector data on house price inflation, as well as a closely watched report on consumer confidence.
Wednesday, September 25
The U.S. is to release data on durable goods orders, a leading indicator of production, in addition to a report on new home sales.
Thursday, September 26
The U.S. is to release the weekly report on initial jobless claims, as well as final data on second quarter growth and private sector data on pending home sales.
Friday, September 27
Japan is to release data on consumer price inflation, which accounts for the majority of overall inflation.
The U.S. is to round up the week with revised data on consumer sentiment and inflation expectations from the University of Michigan, as well as data on personal income and expenditure.
St. Louis Federal Reserve President James Bullard said the decision not to taper in September was “close” and did not rule out a small reduction in the central bank's bond purchases in October. The comments came during an interview with Bloomberg television.
USD/JPY hit session highs of 99.67 following the comments, before settling at 99.36, dipping 0.08%. The pair ended the week 0.27% higher, after falling to three-week lows of 97.75 on Wednesday.
The pair is likely to find support at 97.75 and resistance at 99.98, the high of September 12.
The dollar dropped to three-week lows against the yen on Wednesday after the Federal Reserve said it wanted to see more evidence of a sustained economic recovery before it adjusted the scale of its bond buying program.
The decision surprised markets, which had been expecting the Fed to cut its USD85 billion-a-month stimulus program by USD10 billion to USD15 billion.
In a press conference following the Fed statement, Chairman Ben Bernanke reiterated that the plan to taper asset purchases was never a "preset course," and added that the bank's decision was dependent on how the economic recovery continues to progress.
The central bank also said it will keep interest rates on hold at record low levels until the unemployment rate falls to around 6.5%, as long as inflation doesn't accelerate beyond 2.5% a year.
In the week ahead, uncertainty over the direction of Federal Reserve policy and the decision over Chairman Ben Bernanke’s eventual successor look likely to weigh on the dollar. Meanwhile, markets in Japan are to remain closed for a holiday on Monday.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, September 23
Markets in Japan are to remain closed for a national holiday.
Tuesday, September 24
The U.S. is to release private sector data on house price inflation, as well as a closely watched report on consumer confidence.
Wednesday, September 25
The U.S. is to release data on durable goods orders, a leading indicator of production, in addition to a report on new home sales.
Thursday, September 26
The U.S. is to release the weekly report on initial jobless claims, as well as final data on second quarter growth and private sector data on pending home sales.
Friday, September 27
Japan is to release data on consumer price inflation, which accounts for the majority of overall inflation.
The U.S. is to round up the week with revised data on consumer sentiment and inflation expectations from the University of Michigan, as well as data on personal income and expenditure.