Forex - USD/JPY rises after disappointing Japanese data

The U.S. dollar traded higher against the Japanese yen during Tuesday’s Asian session, gaining some strength against the Japanese currency for the first time in several days following the release of some concerning data points out of the world’s third-largest economy.

In Asian trading Tuesday, USD/JPY rose 0.12% to 98.08. The pair was likely to find resistance at 100.45, Wednesday's high, and support at 97.64, the earlier low. 

Data released earlier Tuesday showed household spending in Japan fell 0.4% last month. Economists were expecting a 1.4% increase. 

Another report showed Japanese industrial production dropped 3.3%, far worse than the 1.5% decline forecast by economists. 

Separately, Japan’s Statistics Bureau said unemployment in the world’s third-largest economy fell to 3.9% in June from 4.1% in May. Economists expected the June reading to come in at 4%. 

Those data points come after a report released Monday that showed Japanese retail sales rose by an annualized rate of 1.6% in June, less than the expected 1.9% increase, but up from a 0.8% gain the previous month. 

Also on Monday, Bank of Japan Governor Haruhido Kuroda said the stimulus measures introduced by the central bank last April are having positive effects on financial markets, the economy, and expectations for price rises. 

Speaking at the Research Institute of Japan, in Tokyo, Kuroda cautioned however that the BoJ is still far from achieving its 2% inflation goal, comments that sent the yen soaring and Japanese stocks plummeting. 

In U.S. economic news out Monday, the National Association of Realtors said its Pending Homes Sales Index fell 0.4% to 110.9 in June and the May reading was revised lower to 111.3 from 112.3. 

Elsewhere, EUR/JPY also rose 0.08% to 130.04 while AUD/JPY fell 0.21% to 89.99.