Yen Halts Rally as Economic Data Provides Mixed Picture

The Japanese yen attempted to extend its rally against the US dollar today but failed and retreated close to the opening level. The currency traded mostly sideways against other major counterparts.

Today’s economic data provided a mixed picture of Japan’s economic performance, failing to give an edge to the yen. On one hand, Japan’s core Consumer Price Index rose 3.3 percent in July, and Tokyo core CPI advanced 2.7 percent in August, both on an annual basis, while retail sales grew 0.5 percent in July instead of falling 0.1 percent as was predicted by analysts. On the other hand, household spending slumped 5.9 percent in July over the year, the unemployment rate unexpectedly ticked up 0.1 percentage point to 3.8 percent, and industrial production expanded just 0.2 percent, trailing market expectations of 1.2 percent growth.

The yen was stronger yesterday, rising against other most-traded currencies, including the dollar. The Japanese currency found support from escalating tensions between Ukraine and Russia after Ukrainian officials said that Russia is going to start a “full-scale invasion”.

USD/JPY traded near the opening level of 103.72 as of 1:22 GMT today after falling to 103.66 earlier. EUR/JPY was near 136.70, and GBP/JPY traded at about 171.99, both close to the opening.

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