USD/JPY: Yen Down As Weak Economic Data Spurs Easing Prospects

USD/JPY: Yen Down As Weak Economic Data Spurs Easing Prospects

For the 24 hours to 23:00 GMT, the USD strengthened 0.54% against the JPY and closed at 83.68.

The Yen declined amid speculation that Shinzo Abe’s Liberal Democratic Party would win Japanese elections this weekend and push the central bank to expand monetary easing.

In the Asian session, at GMT0400, the pair is trading at 83.86, with the USD trading 0.22% higher from yesterday’s close.

The Yen is trading lower as weaker-than-expected Japanese economic data released this morning further boosted expectations that the Bank of Japan would go for more monetary easing next week to stimulate the economy.

This morning, the Tankan survey indicated business sentiment amongst large manufacturers’ in Japan deteriorated to a reading of -12.0 in the fourth quarter of 2012, the lowest reading since the first quarter of 2010.

Additionally, industrial production in Japan climbed 1.6% (MoM) in October, downwardly revised from the preliminary estimate of 1.8%.

The pair is expected to find support at 83.43, and a fall through could take it to the next support level of 83. The pair is expected to find its first resistance at 84.11, and a rise through could take it to the next resistance level of 84.36.