Forexpros – The euro fell to a four-day low against the yen on Thursday, as Japanese companies continued to repatriate overseas earnings before the end of the country’s fiscal year on March 31 while sustained euro zone debt concerns weighed on the shared currency.
EUR/JPY hit 108.79 during U.S. morning trade, the pair’s lowest since March 23; the pair subsequently consolidated at 108.96, tumbling 1.30%.
The pair was likely to find support at 108.37, the low of March 14 and resistance at 110.50, the day’s high.
Sentiment on the euro was hit by concerns over rising Spanish borrowing costs ahead of the government’s budget statement, amid fears that the government will fail to implement harsh austerity measures to slash the country’s deficit, in the face of public unrest and a looming recession.
Elsewhere in the euro zone, the Bank of Portugal said earlier that it now expects the economy to contract by 3.4% this year, down from a previous forecast for a 3.1% contraction. It also expects zero growth in 2013, down from a previous forecast of 0.3%.
Earlier in the day, official data showed that the number of unemployed people in Germany fell more-than-expected in March, while the country’s jobless rate dropped to a record low of 6.7%, indicating that the region’s largest economy is shrugging off the effects of the debt crisis.
Meanwhile, investors continued to look ahead to a meeting of euro zone finance ministers on Friday, amid expectations that they would agree on a larger debt firewall to combat the debt crisis in the region.
The yen was also higher against the U.S. dollar with USD/JPY dropping 0.94%, to hit 82.12.
Also Thursday, official data showed that retail sales in Japan rose more-than-expected in February, adding 3.5% after a 1.8% increase the previous month.
Later in the day, Federal Reserve Chairman Ben Bernanke was due to speak.
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