Investing.com – The U.S. dollar edged lower against the yen in thin holiday trade on Monday, as concerns over a potential U.S. sovereign debt default boosted the appeal of the safe-haven yen.
USD/JPY hit 78.94 during late Asian trade, the pair’s daily low; the pair subsequently consolidated at 78.99, declining 0.18%.
The pair was likely to find support at 78.45, the low of July 14 and four-month low and resistance at 79.58, the high of July 14.
With markets in Tokyo closed in observance of Marine Day, trading volumes were low, resulting in quiet trade.
U.S. President Barack Obama said over the weekend that the U.S. government was “running out of time” in regards to negotiations over lifting the country’s USD14.3 trillion debt ceiling before an August 2 deadline.
Former U.S. Treasury Secretary Larry Summers said that a U.S. debt default would cause panic throughout the financial system and long-term uncertainty.
Ratings agencies Moody’s and Standard & Poor’s both warned last week that a failure to raise the debt limit in time would result in a downgrade in the credit rating of the world’s largest economy.
The safe-haven appeal of the yen was also bolstered amid ongoing concerns over the euro zone’s debt woes.
Euro zone finance ministers were to meet Thursday to focus on “the financial stability of the euro area as a whole and the future financing of the Greek program,” according to the president of the European Council, Herman Van Rompuy.
The European Banking Authority said Friday that eight banks out of the region’s 90 top lenders failed its stress tests, with a combined capital shortfall of EUR2.5 billion.
The EBA said 16 banks narrowly passed the stress tests. Of the banks that failed the tests, five were in Spain, two in Greece and one in Austria, while all of the region’s biggest firms passed the test.
The yen was also higher against the euro, with EUR/JPY dropping 0.93% to hit 110.96.
Later in the day, the U.S. was to publish a government report on the balance of domestic and foreign investments.
USD/JPY hit 78.94 during late Asian trade, the pair’s daily low; the pair subsequently consolidated at 78.99, declining 0.18%.
The pair was likely to find support at 78.45, the low of July 14 and four-month low and resistance at 79.58, the high of July 14.
With markets in Tokyo closed in observance of Marine Day, trading volumes were low, resulting in quiet trade.
U.S. President Barack Obama said over the weekend that the U.S. government was “running out of time” in regards to negotiations over lifting the country’s USD14.3 trillion debt ceiling before an August 2 deadline.
Former U.S. Treasury Secretary Larry Summers said that a U.S. debt default would cause panic throughout the financial system and long-term uncertainty.
Ratings agencies Moody’s and Standard & Poor’s both warned last week that a failure to raise the debt limit in time would result in a downgrade in the credit rating of the world’s largest economy.
The safe-haven appeal of the yen was also bolstered amid ongoing concerns over the euro zone’s debt woes.
Euro zone finance ministers were to meet Thursday to focus on “the financial stability of the euro area as a whole and the future financing of the Greek program,” according to the president of the European Council, Herman Van Rompuy.
The European Banking Authority said Friday that eight banks out of the region’s 90 top lenders failed its stress tests, with a combined capital shortfall of EUR2.5 billion.
The EBA said 16 banks narrowly passed the stress tests. Of the banks that failed the tests, five were in Spain, two in Greece and one in Austria, while all of the region’s biggest firms passed the test.
The yen was also higher against the euro, with EUR/JPY dropping 0.93% to hit 110.96.
Later in the day, the U.S. was to publish a government report on the balance of domestic and foreign investments.