Forexpros – The U.S. dollar rose to a four-day high against the yen on Friday, as a pledge by European Central Bank President Mario Draghi to do everything in his mandate to save the euro bolstered hopes for more steps to counter the debt crisis in the single currency bloc.
USD/JPY hit 78.38 during early European trade, the pair’s highest since July 23; the pair subsequently consolidated at 78.33, rising 0.18%.
The pair was likely to find support at 77.94, the low of July 23 and a one-month low and resistance at 78.80, the high of July 20.
In a speech in London, Draghi also appeared to indicate that the ECB would be prepared to intervene to lower Spanish and Italian bond yields, saying that government borrowing costs would fall within the central bank’s mandate if they interfered with the ‘transmission’ of monetary policy.
But the greenback’s gains were limited as a string of mixed U.S. data on Thursday, sparked fresh expectations for further easing measures by the Federal Reserve.
Industry data showed that pending home sales in the U.S. fell by 1.2% in June, disappointing expectations for a 0.2% increase, while the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending July 21 fell to a seasonally adjusted 353,000, compared to expectations for a decline to 380,000.
Separately, official data showed that U.S. durable goods orders rose 1.6% in June, beating expectations for a 0.4% increase and following a 1.6% rise in May. The report also showed that core durable goods orders, which exclude transportation items, fell unexpectedly in June by 1.1%.
In Japan, government data showed that retail sales rose less-than-expected in June, ticking up 0.2% after a 3.6% increase the previous month. Analysts had expected retail sales to rise 1.2% in June.
The report came after official data showed that Tokyo’s core consumer price inflation, which excludes fresh food, fell 0.6% in July, in line with expectations and after a 0.6% decline the previous month.
Elsewhere, the yen was lower against the euro with EUR/JPY rising 0.32%, to hit 96.34.
Later in the day, the U.S. was to publish advanced data on economic growth followed by a report by the University of Michigan on consumer sentiment.
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