USD/JPY Holds Below 121 Yen Even With a Weaker Japanese Economy

The U.S. dollar stayed largely firm in the mid-121 yen range amid an upbeat outlook for the U.S. economy, although traders briefly turned to the safe-haven yen following an unexpected downward revision in Japan’s gross domestic product data for the July to September period.

At 5 p.m., the dollar fetched 121.34-36 yen compared with 121.48-58 yen in New York and 120.17-18 yen in Tokyo at 5 p.m. Friday. It moved between 121.26 yen and 121.86 yen during the day, changing hands most frequently at 121.52 yen.

The euro was quoted at $1.2269-2270 and 148.88-92 yen against $1.2278-2288 and 149.24-34 yen in New York and $1.2380-2382 and 148.77-81 yen in Tokyo late Friday afternoon.

The dollar was mostly solid against the yen in Tokyo trading on Monday, carrying over the momentum prompted by the stronger-than-expected November U.S. jobs data released Friday that sent the U.S. currency above 121 yen for the first time since July 2007.

The dollar briefly faced downward pressure as the Japanese government announced earlier Monday that the economic contraction in the third quarter was deeper than expected, leading traders to be risk averse and buy the yen believed to be safer than other major currencies for the dollar, dealers said.

via Mainichi

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza