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Forexpros – The U.S. dollar moved lower against the Japanese yen in U.S. trade Friday, as Federal Reserve Chairman Ben Bernanke announced the central bank would postpone a decision on monetary policy until next month’s meeting.
In early Asian trade USD/JPY hit 77.51, the pair’s highest since Thursday ; the pair subsequently consolidated at 76.61, dropping 1.11%.
The pair was likely to find support at 76.47, Tuesday’s low, and resistance at 77.93, Tuesday’s high.
In a highly anticipated speech, Fed Chairman Ben Bernanke said further discussion was necessary on monetary easing options and that the topic would be renewed at the central bank’s next Federal Open Market Committee meeting beginning September 20.
“These options were discussed in August and we will continue to consider these and other pertinent issues at our meeting in September,” Bernanke said.
Dealers had been looking for signs from the Fed of a possible new round of quantitative easing in light of persistently high unemployment, weak factory orders and the recent downgrade by Standard & Poor’s of the U.S. top-notch credit rating.
Earlier in the day, the Bureau of Economic Analysis reported that U.S. gross domestic product rose to a seasonally adjusted rate of 1% in the second quarter. That followed a 1.3% rise the previous three-month period but below market expectations of a 1.1% gain for the April to June quarter.
Wall Street shares dipped on the news before recovering to post modest gains in early U.S. trade.
The Dow Jones Industrial Average advanced 0.84% to 11,243.06, the Nasdaq Composite Index rose 1.93% to 2,466.34, and the S&P 500 added 1.22%. to 1,174.70.
Meanwhile, the yen moved higher against both the euro and the British pound with EUR/JPY down 0.50% to hit 110.81, and GBP/JPY falling 0.78% to hit 125.11.
Bernanke announced that the Federal Reserve Bank would be extending its September meeting to two days, September 20 and 21, in order review policy options.
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