CANBERA (dpa-AFX) - The Japanese yen strengthened against other major currencies in the Asian session on Thursday, as traders speculate on a Bank of Japan (BoJ) rate hike at its next week monetary policy meeting.
The recent hawkish remarks by BoJ Governor Kazuo Ueda reinforced expectations among traders and also caused rates on Japanese Government Bonds (JGBs) to reach multi-year highs.
Growing bets that the Federal Reserve (Fed) will lower interest rates twice this year and waning concerns about disruptive trade policies by U.S. President-elect Donald Trump, also led to the upturn of the safe-haven JPY.
Trading later in the day may be impacted by the release of U.S. reports on weekly jobless claims and retail sales.
In economic news, producer prices in Japan were up 0.3 percent on month in December, the Bank of Japan said on Thursday. That was unchanged from the November reading, but shy of expectations for an increase of 0.4 percent.
On a yearly basis, producer prices advanced 3.8 percent - matching forecasts and unchanged from the previous month following an upward revision from 3.7 percent. Export prices were down 0.2 percent on month and up 0.7 percent on year, the bank said, while import prices slumped 0.9 percent on month and 3.3 percent on year.
In the Asian trading today, the yen rose to more than a 1-month high of 159.75 against the euro, nearly a 1-1/2-month high of 189.83 against the pound and more than a 5-week high of 170.27 against the Swiss franc, from yesterday's closing quotes of 160.99, 191.52 and 171.44, respectively. If the yen extends its uptrend, it is likely to find resistance around 156.00 against the euro, 187.00 against the pound and 168.00 against the franc.
Against the U.S. and the Canadian dollars, the yen advanced to a 4-week high of 155.21 and nearly a 1-month high of 108.24 from Wednesday's closing quotes of 156.47 and 109.09, respectively. On the upside, 152.00 against the greenback and 105.00 against the loonie are seen as the next resistance levels for the yen.
Against the Australia and the New Zealand dollars, the yen climbed to 3-day highs of 96.59 and 87.25 from yesterday's closing quotes of 97.42 and 87.86, respectively. The next possible upside targets for the yen are seen around 98.00 against the aussie and 85.00 against the kiwi.
Looking ahead, Eurostat is slated to issue euro area foreign trade data for November at 5:00 am ET in the European session. The trade surplus is forecast to rise to EUR 11.8 billion in November from EUR 6.8 billion in October.
At 7:30 am ET, the European Central Bank is scheduled to issue the account of the monetary policy meeting of the Governing Council held on December 11 and 12.
In the New York session, Canada housing starts for December, U.S. retail sales for December, export and import prices for December, weekly jobless claims, U.S. Philadelphia Fed manufacturing index for January, Canada new motor vehicle sales data for November, U.S. business inventories for November and U.S. NAHB housing market index for January are slated for release.
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