Investing.com - The U.S. dollar traded lower against the Japanese yen during Thursday’s Asian as traders moved to the Japanese currency as safe-haven alternative to the greenback.
In Asian trading Thursday, USD/JPY fell 0.11% to 98.02. The pair was likely to find support at 97.50, the low of August 6 and resistance at 99.14, the high of August 5.
The dollar traded lower against nearly all of its major rivals Thursday following some U.S. economic news out during Wednesday’s U.S. session. In U.S. economic news out Wednesday, the Labor Department said producer prices were flat last month, indicating little in the way of inflationary pressures in the world’s largest economy. Core prices increased 0.1% last month, below the 0.2% increase analysts expected. Year-over-year, the produce price index was up 1.2%.
While the yen remains the worst-performing developed market currency in the world this year, a scenario that benefits Japanese exporters and stocks, the currency has gained some strength recently prompting some traders to wonder if the Bank of Japan needs to add to its already massive stimulus program to further weaken the yen.
Short positions against the yen in U.S. currency futures reached USD10.3 billion last week and the yen remains shorted by the highest amount in six years, according to the Financial Times.
However, all that bearishness has not translated to recent downside for the Japanese currency. That could be a sign traders believe BoJ is out of ammunition and that the central can do little to further depress the yen.
Elsewhere, EUR/JPY inched down 0.01% to 130.08 after data showed the euro zone's gross domestic product expanded by 0.3% in the second quarter, outpacing market calls for quarter-on-quarter growth of 0.2%.
France’s economy grew 0.5%, while Germany’s economy expanded by 0.7%. Germany and France are the region’s two largest economies.
AUD/JPY rose 0.26% to 89.79.