The USD/JPY is set to close out the trading week just south of the 148.50 level after peaking at an intraday high of 148.40 as the US Dollar (USD) covers its bids on a mixed Purchasing Manager Index (PMI) reading.
The Bank of Japan (BoJ) kept the bottom band of its main policy rate at -0.1% early on Friday, which shook off some bullish momentum for the Yen (JPY).
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US S&P Global Manufacturing PMI improves to 48.9, Services PMI declines to 50.2 in September
Yen bulls found little love from the BoJ on Friday as the Japanese central bank reaffirmed its easy monetary policy stance until they see Japanese inflation maintaining 2% "in a stable manner". Inflation in the Japanese economy is on the high end for the time being, but price growth is expected to decline appreciably in the coming months, and the BoJ continues to be far off of a hawkish policy change.
US PMI figures came in somewhere in the middle, with manufacturing showing a minor improvement and services backsliding.
The US S&P Global Manufacturing PMI jumped further than expected, printing at 48.9 versus the expected 48, but the Services component missed to the downside, printing at 50.2 compared to the forecast 50.6. The mixed printing helped prop up the Greenback against the Yen, but kept gains restrained within the previous day's highs.
Thursday's backslide saw the USD/JPY fall to the 200-hour Simple Moving Average (SMA) before giving a rebound through early Friday trading.
The pair has gained steadily through the week, and is set to finish on the high end, currently looking for a foothold just beneath the week's peak of 148.46.
On the daily candlesticks the USD/JPY is decidedly bullish, up nearly 8% from July's bottom near 137.20. Bullish price momentum is seeing technical support from the 34-day Exponential Moving Average (EMA), and the US Dollar has gained over 13% against the Japanese Yen so far this year.
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