US dollar fell for the second day against the Japanese yen on Thursday, as Asian shares registered losses overnight, which supported demand for safe haven yen.
USD/JPY slid to a session low at 99.18 at 6:12 GMT, the pairs lowest point since September 6th, after which consolidation followed at 99.61, erasing 0.30% for the current day. Support was likely to be found at September 6th low, 98.53, while resistance was to be met at the psychological 100.00 level.
The MSCI Asia Pacific Index of shares dropped as much as 0.2%, before becoming slightly changed. Japanese Nikkei 225 index was losing 0.26% at 8:54 GMT to reach 14 387.27. This retreat came after earlier on Thursday it became clear that Japanese machine orders remained unchanged in July on a monthly basis, following the 2.7% drop in June. Preliminary estimates pointed a 2.4% advance. In annual terms, machine orders rose by 6.5% in July, below the projected 7.7% gain. These results underscored limits on corporate investment, as Japanese Prime Minister Shinzo Abe struggles to end 15 years of deflation and drive the economic recovery in the country.
Meanwhile, the greenback was still feeling pressure, after last Friday it became clear that US economy managed to add fewer than projected job positions in the month of August.
“The Fed will start tapering next week, but I think they might also be a bit dovish,” said Joseph Capurso, a Sydney-based currency strategist at Commonwealth Bank of Australia (CBA), cited by Bloomberg. “That might see the U.S. dollar weaken again in a knee-jerk reaction.”
The Federal Open Market Committee will meet on September 17-18th and is expected to cut the monthly asset-buying program to 75 billion USD from the current 85-billion-USD pace, according to the median estimate in a survey on September 6th by Bloomberg News. Federal Reserve Bank of New York President William Dudley takes a statement today in Paris. He said in July that economic growth will probably accelerate during the next year and this could possibly warrant a reduction in stimulus.
Elsewhere, the yen was advancing against the euro, with EUR/JPY cross decreasing 0.49% on a daily basis to trade at 132.34 at 8:43 GMT.
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