The U.S. dollar edged up against the yen on Wednesday, to trade close to six-month highs as speculation over the future of the Federal Reserve''s stimulus program supported the greenback, while expectations for more easing in Japan dampened demand for the yen.
USD/JPY hit 102.75 during late Asian trade, the session high; the pair subsequently consolidated at 102.72, adding 0.20%.
The pair was likely to find support at 101.94, the low of November 28 and resistance at 103.38, Tuesday''s high and a six-month high.
The dollar remained supported after the Institute for Supply Management said Monday that manufacturing activity in the U.S. expanded at the fastest rate since April 2011 in November, fuelling optimism over the economic recovery.
Meanwhile, expectations that the Bank of Japan will have to expand its stimulus program in order to meet its target of 2% inflation by 2015 continued to pressure the yen lower.
Earlier in the week, BoJ Governor Haruhiko Kuroda pledged to counter any new downside risks to the bank’s inflation goal, saying the BoJ would act by "adjusting monetary policy without hesitation."
The yen was also lower against the euro, with EUR/JPY edging up 0.10% to 139.45.
Later in the day, the U.S. was to release the ADP report on private sector job creation, as well as data on new home sales and the trade balance. In addition, the Institute of Supply Management was to release its services PMI.
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