Investing.com - The dollar ended the week higher against the yen on Friday amid expectations that the Federal Reserve will continue to reduce stimulus, while the Bank of Japan sticks to its quantitative easing program.
USD/JPY hit 102.82, the highest since January 31 and was last up 0.22% to 102.49. The pair ended the week 0.41% higher.
The pair is likely to find support at 101.90 and resistance at 103.30.
The dollar trimmed gains against the yen after a report showed that U.S. existing home sales fell by a larger-than-forecast 5.1% in January, dropping to an 18-month low.
The report came in the wake of other weaker-than-expected U.S. economic indications, as sever winter weather impacted on economic activity.
However, demand for the dollar continued to be underpinned after Wednesday’s minutes of the Fed’s January meeting showed that officials agreed the current pace of reductions to the bank’s asset purchase program would remain unchanged, so long as the economy shows signs of improvement.
The yen remained under pressure after the BoJ voted to extend a bank lending scheme on Tuesday, in an attempt to boost the effectiveness of its monetary stimulus program.
The decision came after official data on Monday showed that Japan’s gross domestic product expanded 0.3% in the final three months of 2013 and grew 1.0% on a year-over-year basis.
Market expectations had been for quarterly growth of 0.7% and an annual increase of 2.8%.
The euro was also higher against the yen on Friday, with EUR/JPY last up 0.37% to 140.83. For the week, the pair gained 0.67%.
In the week ahead, U.S. data on durable goods orders and consumer confidence will be in focus, while Japan is to release data on retail sales, inflation and industrial production.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday, as there are no relevant events on this day.
Tuesday, February 25
The U.S. is to release data on consumer confidence and a private sector report on house price inflation.
Wednesday, February 26
The U.S. is to release data on new home sales, a leading indicator of demand in the housing market.
Thursday, February 27
The U.S. is to release data on durable goods orders, a leading indicator of production, and the weekly report on initial jobless claims.
Friday, February 28
Japan is to release a series of data, including reports on household spending, retail sales, inflation, and industrial production.
The U.S. is to round up the week with revised data on fourth quarter growth, a report on manufacturing activity in the Chicago region, revised data on consumer sentiment and private sector data on pending home sales.