The Japanese yen rose against its major counterparts in the Asian session on Monday amid safe-haven demand, following remarks from U.S Treasury Secretary Janet Yellen that President Joe Biden’s spending plan would be beneficial to the economy, even if they trigger higher inflation and a rate hike move by the U.S Federal Reserve.
The President’s $4 trillion spending plan is positive for the economy, although they spur inflation that persists into 2022, Yellen said in an interview with Bloomberg News.
Yellen added that a “slightly higher” interest rate environment would be an advantage.
Investors await key U.S. inflation data due later this week for more indications about the Fed’s policy outlook.
Japan’s leading index rose to the highest level in seven years in April, according to a preliminary data by the Cabinet Office.
The leading index, which measures the future economic activity, grew to 103.0 in April from 102.4 in March.
The yen climbed to 109.38 against the greenback and 90.48 against the loonie, off its early lows of 109.64 and 90.78, respectively. The yen may locate resistance around 107.5 against the greenback and 88.00 against the loonie.
The yen spiked higher to near 2-week highs of 133.05 against the euro, 154.56 against the pound and 121.54 against the franc, after falling to 133.39, 155.28 and 121.91, respectively in early deals. The yen is likely to locate resistance around 131.00 against the euro, 148.00 against the pound and 117.00 against the franc.
The yen reversed from its early 4-day lows of 79.06 against the kiwi and 84.88 against the aussie and recovered to 78.80 and 84.65, respectively. The next possible resistance for the yen is seen around 75.00 against the kiwi and 80 against the aussie.
Looking ahead, the U.S. consumer credit for April will be out in the New York session.
The material has been provided by InstaForex Company – www.instaforex.com