U.S. Dollar Recovers Ground on Yen

By: Barbara Zigah

During the early Asian trading session, the U.S. Dollar recovered from a 10-day trough versus the Japanese Yen as Japanese importers used the pair’s dip to buy into the greenback. The Japanese Yen was also lower against the Australian Dollar and the common currency Euro; in general, commodity currencies took a big hit last week on concerns that China’s growth slow down will spillover globally. As reported at 12:22 p.m. (JST) in Tokyo, the U.S. Dollar was trading at 82.72 Japanese Yen, a rise of 0.5% and nearer to the 11-month peak of 84.19 Yen struck mid-month. The Yen lost 0.7% against the Euro to trade at 109.74 Yen, while against the Australian Dollar the Japanese currency slid 0.2% to trade at 86.50 Japanese Yen.

The Euro is likely to face a difficult week on the heels of the dismal growth news from China, and disappointing PMI data from Europe as well. The EUR/USD pair held close to Friday’s 3-week peak of $1.3294 and is currently trading at $1.3259. This week, key economic data which includes Germany’s IFO sentiment readings today and CPI tomorrow, will put significant pressure on the Euro; also ahead is an Italian bond auction and the Eurozone Ecofin meeting.