Investing.com - The yen strengthened after a slew of policy remarks from Japan and the Aussie held weaker but recovered some ground on Wednesday as the trade balance widened, but building showed a bright spot.
AUD/USD changed hands at 0.7016, down 0.31%. USD/JPY traded at 119.60, down 0.30%, after the release of December board minutes from the Bank of Japan that suggested there were no plans to move to negative interest rates at the time.
Later, Bank of Japan Governor Haruhiko Kuroda on Wednesday said expectations of lower prices among firms and households are "slightly concerning" but the bank's mission to achieve 2% inflation is "unshaken."
In Australia, building approvals rose 9.2% in December, well above the 5.0% gain seen, private house approvals rose 5.4% in December, overcoming a 0.8% fall the previous month and exports fell 5% and imports were down 1% as the trade balance came in at A$3.535 billion, wider than the A$2.5 billion expected.
As well, the Caixin Services PMI for January came in at 52.4, beating the expected 50.5 level.
Earlier in Australia, the AIG services index rose 2.1 points to 48.4 for January.
In New Zealand, the unemployment rate dropped sharply to 5.3% from an expected 6.1% rate, while the Reserve Bank of New Zealand may cut the official cash rate again this year, Governor Graeme Wheeler said Wednesday.
NZD/USD traded at 0.6534, up 0.33%.
The jobs drop was the subject of some assessment by Capital Economics in A Feb. 3 note to clients that said it cuts the chance of a rate cut going forward.
"The startling plunge in the unemployment rate in New Zealand in the fourth quarter of last year, to 5.3% from 6.0% in the third quarter, decreases the chances that the RBNZ will reduce interest rates further.
"The main reason, however, why the unemployment rate fell so far was because the labour force increased by just 5,000. That followed an unusually weak -9,000 decline in the third quarter and is odd when we know that net migration has remained close to record highs. The circle can be squared because once again the number of people classed as “not in the labour force” rose by 14,000, largely due to 31,500 people retiring."
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was quoted down 0.02% to 98.86.
Overnight, the dollar remained moderately lower against the other major currencies on Tuesday, as oil prices resumed their downward trend and as concerns over global economic growth persisted.
Meanwhile, investors remained cautious amid ongoing concerns over global economic growth after data on Monday showed that manufacturing activity in China contracted for a sixth straight month in January.