Forexpros – The U.S. dollar was lower against the safe haven yen on Tuesday, after briefly spiking to a two-day high earlier, as concerns about the euro zone’s massive financial problems weighed on demand for riskier assets.
USD/JPY hit 77.50 during late Asian trade, the pair’s highest since Friday; the pair subsequently consolidated at 77.01, dipping 0.05%.
The pair was likely to find support at 76.80, Monday’s low and a two-week low and resistance at 77.67, Friday’s high.
The brief dollar spike was not believed to have been caused by an intervention. Investors have remained jittery over the possibility of a move to weaken the yen, since Japan intervened in the foreign exchange market on October 1 to curb the appreciation of the persistently strong currency.
Safe haven demand remained supported after the yield on Italian five-year bonds climbed to a euro-era high of 6.29% on Monday, in the first Italian bond sale since former European Commissioner Mario Monti was appointed prime minister.
Meanwhile, the yield on 10-year Spanish government bonds rose above 6% for the first time since August.
The yen was also higher against the euro, with EUR/JPY shedding 0.43% to hit 104.61.
Later Tuesday, the U.S. was to release official data on retail sales and producer price inflation, while the euro zone was to publish preliminary data on GDP growth.
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