Forex - USD/JPY edges lower after Japan data, but remains supported

Investing.com - The U.S. dollar edged lower against the yen on Friday, after a string of mixed data out of Japan, although expectations for the Federal Reserve to soon begin tapering its asset purchases still supported the greenback. 

USD/JPY hit 98.08 during late Asian trade, the session low; the pair subsequently consolidated at 98.16, edging down 0.19%. 

The pair was likely to find support at 96.88, the low of August 28 and resistance at 99.15, the high of August 23. 

In a report, Markit research group said Japan's manufacturing purchasing managers' index rose to 52.2 in August, from a reading of 50.7 the previous month. 

A preliminary report also showed that industrial production in Japan rose 3.2% in July, less than the expected 3.7% increase, after a 3.1% decline the previous month. 

Data also showed that consumer price inflation in Japan rose to an annualized rate of 0.7% last month, from 0.4% in June, compared to expectations for an uptick to 0.6%. 

Household spending in Japan rose by an annualized rate of 0.1% in July, official data showed, compared to expectations for a 0.3% rise, following a 0.4% decline the previous month. 

Meanwhile, the dollar remained supported after the Commerce Department on Thursday said gross domestic product expanded at an annual rate of 2.5% in the three months to June, above expectations for growth of 2.2% and up from a preliminary estimate of 1.7%.

In a separate report, the Department of Labor said the number of people who filed for unemployment assistance fell to the lowest level since October 2007 last week.

The number of people filing for initial jobless benefits in the week ending August 23 fell by 6,000 to a seasonally adjusted 331,000, compared to forecasts for a decline of 5,000. 

The upbeat data added to the view that the Federal Reserve could start phasing out stimulus measures as soon as next month. 

Investors were also cautious amid concerns over prospects for a U.S.-led military strike against Syria’s government, following the alleged use of chemical weapons. 

The yen was higher against the euro with EUR/JPY slipping 0.10%, to hit 130.03.
 
Later in the day, the U.S. was to release a report on manufacturing activity in Chicago and revised data from the University of Michigan on consumer sentiment, as well as data on personal income and personal spending.