Investing.com - The dollar rose to three-week highs against the yen on Friday after economic data indicated that the U.S. economy may be regaining its footing after a recent soft patch.
USD/JPY was up 0.64% 120.13 in late trade, the most since April 13, recovering from Thursday’s five-week lows of 118.48.
A report by the Institute for Supply Management on Friday showed that activity in the manufacturing sector was stable in April, after slowing in the five previous months.
The ISM manufacturing index came in at 51.5 in April, matching the March reading, which had been the lowest since May 2013.
Another report showed that U.S. consumer sentiment rose in April to its highest level since January.
Separately, the Commerce Department said construction spending fell 0.6% to an annual rate of $966.6 billion in March, the lowest level since September.
The reports, while mixed, fuelled optimism that the U.S. economy has turned a corner after a recent bout of weakness.
The dollar had received a boost after a report on Thursday showed that the number of Americans filing new claims for jobless benefits fell to a 15-year low of 262,000, pointing to healthy growth in the labor market.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last up 0.53% to 95.38 late Friday, after falling to two-month lows of 94.47 on Thursday.
Data earlier in the week showed that the U.S. economy grew just 0.2% in the three months to March, slowing from 2.2% in the final quarter of 2014. It was the slowest rate of growth in a year.
The weaker-than-expected data prompted investors to push back expectations on the timing of an initial rate hike by the Federal Reserve to later this year from midyear.
In its rate statement on Wednesday the Federal Reserve said recent indications of a slowdown in growth were probably due to “transitory factors.”
In the week ahead, investors will be focusing on Friday’s U.S. nonfarm payrolls report, for a fresh indication on the strength of the economic recovery. Meanwhile, markets in Japan will be closed for Golden Week holidays.
Monday, May 4
Markets in Japan are to remain closed for holidays.
The U.S. is to publish figures on factory orders.
Tuesday, May 5
Markets in Japan are to remain closed for a holiday.
The U.S. is to release trade data, while the Institute of Supply Management is to release a report on service sector activity.
Wednesday, May 6
Markets in Japan are to remain closed for holidays.
The U.S. is to release its monthly ADP nonfarm payrolls report and Later in the day Fed Chair Janet Yellen is to speak at an event in Washington DC.
Thursday, May 7
The U.S. is to publish the weekly report on initial jobless claims.
Friday, May 8
The U.S. is to round up the week with what will be the closely watched government nonfarm payrolls report.