Investing.com - The dollar slid lower against the safe-haven yen on Friday as weakness in U.S. equities underpinned demand for the Japanese currency, while the broadly weaker euro fell to 16-month lows against the yen.
USD/JPY was down 0.61% to 117.78 in late trade, not far from Wednesday’s lows of 117.17.
U.S. stocks fell following soft corporate earnings, which sparked concerns over the potential impact of the stronger dollar.
EUR/JPY hit lows of 130.95, the weakest since September 2013, before pulling back to 132.00, in late trade, off 1.98%. The pair ended the week with losses of 2.91%.
The drop in the single currency came after European Central Bank President Mario Draghi unveiled a €1.2 trillion asset purchase program on Thursday. The central bank will purchase €60 billion in assets per month, starting in March and continuing until late 2016.
Draghi said the program would help return inflation back to the bank’s 2% target. Expectations had been building ahead of the ECB meeting after official figures showed that the annual rate of inflation in the euro area fell into negative territory in December, dropping 0.2%.
The Bank of Japan held off from announcing fresh easing measures earlier in the week, despite cutting its inflation forecast for the year from April 2015, a move that reinforced expectations for further stimulus.
Speaking Friday, BoJ Governor Haruhiko Kuroda said it could examine fresh options if further stimulus was needed.
In the week ahead, investors will be focusing on Friday’s preliminary data on U.S. fourth quarter growth, while the latest euro zone inflation data is also due out on Friday. Wednesday’s Federal Reserve monetary policy statement will be closely watched.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, January 26
The BoJ is to publish the minutes of its latest policy meeting, which contain valuable insights into economic conditions from the bank’s perspective.
Japan is also to publish data on the trade balance.
Tuesday, January 27
The U.S. is to release data on durable goods orders, as well as private sector reports on consumer confidence and new home sales.
Wednesday, January 28
The Federal Reserve is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
Thursday, January 29
Japan is to publish data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity.
Later Thursday, the U.S. is to publish the weekly report on initial jobless claims as well as private sector data on pending home sales.
Friday, January 30
Japan is to release a string of data, including reports on household spending and inflation and preliminary data on industrial production.
The U.S. is to round up the week with preliminary data on fourth quarter growth as well as reports on business activity in the Chicago region and revised data on consumer sentiment.