Forexpros – The U.S. dollar was steady against the yen on Monday, as weak U.S. and Chinese data supported safe haven demand, while disappointing economic reports from Japan weighed on demand for the yen.
USD/JPY hit 79.43 during early European trade, the pair’s lowest since July 3; the pair subsequently consolidated at 79.64, easing 0.04%.
The pair was likely to find support at 79.21, the low of June 28 and resistance at 80.01, the high of July 6.
Official data on Friday showed that the U.S. economy added just 80,000 jobs in June, below market expectations for a gain of around 90,000. It was the third consecutive month where hiring failed to top the 100,000-level.
The report also showed that the U.S. unemployment rate held steady at 8.2% in June, in line with expectations.
Meanwhile, in China, government data released earlier showed that consumer price inflation accelerated at the slowest rate since January 2010 in June, potentially giving Beijing room to further ease monetary policy.
An unexpected rate cut from China last week stocked fears of a deeper-than-expected slowdown in the world’s second largest economy.
In Japan, government data showed that the country’s trade surplus fell to its lowest level since at least 1985 in May, while machinery orders fell the most in seven years.
Japan’s Ministry of Finance said the trade surplus narrowed to JPY0.28 trillion in May from a surplus of JPY0.29 trillion the previous month, disappointing expectations for a rise to JPY0.42 trillion.
Meanwhile, a report by Japan’s Cabinet Office showed that core machinery orders tumbled 14.8% in May, far more than expectations for a 2.4% decline and following a 5.7% rise the previous month.
The yen was fractionally lower against the euro with EUR/JPY adding 0.08%, to hit 97.94.
Later in the day, a report was to be produced on investor confidence in the euro zone, while European Central Bank President Mario Draghi was to testify before the European Parliament.
Investors were also eyeing a meeting of euro zone finance ministers in Brussels, to discuss a plan announced last month to help the region’s indebted nations and banking systems.
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