US dollar decreased significantly versus the yen on Thursday, as China reported weak economic data and indications appeared that FED might reduce scale of easing, which provoked safe heaven search among investors.
During late European session, USD/JPY pair dropped to 101.47.
In testimony to the U.S. Joint Economic Committee yesterday, Fed Chairman Bernanke said a decision to scale back the Fed’s asset purchase program could be taken in the “next few meetings” if economic conditions continued to improve.
Meanwhile, earlier today it became clear that manufacturing in China shrank during May for the first time for the last seven months. China’s HSBC manufacturing PMI dropped to 49.6 in May, from 50.4 in April.
Additionally, the Department of Labor in United States reported that Initial Jobless Claims indicator decreased by a number of 23 000 to seasonally adjusted 340 000 during last week. This was the lowest level, which the indicator recorded for the last 5 years. Last week the revised reading was 363 000 claims.
The euro realized further gains against the US dollar following the report, as EUR/USD added 0.44% to 1.2916.
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