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Forex - Yen weakens in Asian trade despite steady gains in average wages

Published 11/04/2014, 09:19 PM
Updated 11/04/2014, 09:20 PM
Yen weaker in Asia
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Investing.com - The yen weakened in Asia on Wednesday despite data showing as steady rise in wages.

USD/JPY traded at 113.65, up 0.04%, while AUD/USD changed hands at 0.8746, up 0.11%.

In Japan, September total average cash earnings data showed a 0.8% gain in September, a seventh straight gain.

China's HSBC October services PMI came in at 52.9 in October, down from 53.5 in September.

In Australia the AiG services index for October fell 1.8 points to 43.6, signaling weak sales and new orders heading into Christmas.

In New Zealand, the unemployment rate held steady at 5.4% as expected in the third quarter. with employment up 0.8%

At 1130 (0230 GMT), Bank of Japan Governor Haruhiko Kuroda is due to give a speech at a seminar hosted by Kyodo News in Tokyo.

Overnight, less-than-stellar U.S. reports on factory orders and the country's trade balance weakened the dollar against most major currencies, ending several session of strong gains fueled by diverging global monetary policies.

U.S. factory orders fell for a second consecutive month in September, dampening optimism over the pace of U.S. recovery, official data revealed earlier.

The U.S. Census Bureau reported earlier that factory orders declined by 0.6% in September, in line with market expectations though still a decline nonetheless.

The August figure was revised to a 10% contraction from an initial 10.1% decline.

The numbers gave investors room to sell the greenback for profits, wiping out gains stemming from divergent monetary policies coupled with upbeat U.S. manufacturing, consumer sentiment and economic growth reports.

Elsewhere in the U.S., the Bureau of Economic Analysis said the country's trade deficit widened to $43.03 billion in September from $39.99 billion in August, whose figure was revised from a previously reported deficit of $40.1 billion.

Analysts had expected the U.S. trade gap to widen to $40.0 billion in September.

The single currency held well into positive territory despite downward revisions made to the continent's growth forecasts.

The European Commission cut its forecast for euro zone economic growth to 0.8% this year from a 1.2% forecast made in the spring, while the 2015 growth forecast dipped to 1.1% from 1.7%.

The commission added it expects euro area inflation to remain below the European Central Bank's target of close to but just below 2% until after 2016 at the earliest and warned that unemployment levels will remain at their current high levels for longer than previously expected.

The US dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.05% at 87.13.

On Wednesday, expect the dollar to move on U.S. service-sector data.

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