Forex - USD/JPY rises on strong U.S. data

The U.S. dollar traded higher against the Japanese yen during Wednesday’s Asian session as the greenback got a lift from several constructive U.S. economic data points. 

In Asian trading Wednesday, USD/JPY rose 0.27% to 98.06 after earlier trading as high as 98.24. The pair was likely to find resistance at 98.70, Monday's high, and support at 96.97, the earlier low. 

Wednesday’s Asian session was light on marquee data points from the region’s most influential markets and that gave traders an opportunity to focus on U.S. economic news. 

In U.S. economic news out Tuesday, the S&P/Case-Shiller Index of home prices in 20 U.S. metro areas rose 12.1% in April. The 10-city index gained 11.6%. All 20 cities were positive for the fourth straight month. Atlanta, Dallas, Detroit and Minneapolis had the largest year-over-year gains. 

The Commerce Department said new home sales rose 2.1% to a seasonally adjusted annual rate of 476,000 units – the highest level in nearly five years. expected new home sales to rise to a 462,000-unit rate in May. Sales surged 29% year-over-year. 

U.S. consumer confidence rose to 81.4 in June, easily beating the reading of 75 economists expected. The May reading was 74.3. The U.S. consumer is estimated to account for 70% of GDP in the world’s largest economy. 

Combining the U.S. data points with the fact that fears are easing over a possible Chinese credit crunch allowed traders to boost the greenback while lifting Japanese stocks. Not surprisingly, Japanese exporters were among the prime beneficiaries of the weaker yen Wednesday. 

Elsewhere, EUR/JPY rose 0.15% to 128.17 while AUD/JPY added 0.18% to 90.76. NZD/JPY rose 0.12% to 75.83.