Yen Falls As Asian Shares Traded Higher

(RTTNews) - The Japanese yen weakened against other major currencies in the Asian session on Monday, as investors reacted positively to data showing the U.S. economy grew more than expected in the second quarter, which helped quell fears of an imminent recession.

The data also helped ease concerns about the outlook for interest rates, and raised hopes the Fed will end its tightening cycle soon.

Meanwhile, the traders are also cautious ahead of the Reserve Bank Australia's interest rate decision tomorrow, where the central bank is widely expected to pause its interest-rate-hiking cycle.

In economic news, data from the Ministry of Economy, Trade and Industry showed that the value of retail sales in Japan was down 0.4 percent on month in June, coming in at 13.225 trillion yen. That missed expectations for an increase of 0.2 percent following the upwardly revised 1.4 percent gain in May (originally 1.3 percent).

On a yearly basis, retail sales climbed 5.9 percent, matching forecasts and up from 5.8 percent in the previous month.

Also, the industrial output in Japan was up 2.0 percent on month in June. That was shy of expectations for a gain of 2.4 percent following the 2.2 percent decline in May.

On a yearly basis, industrial production slipped 0.4 percent after jumping 4.2 percent in the previous month.

In the Asian trading today, the yen fell to 4-day lows of 156.26 against the euro and 162.81 against the Swiss franc, from Friday's closing quotes of 155.48 and 162.20, respectively. The yen may test support near 158.00 against the euro and 165.00 against the franc.

The yen dropped to a 1-week low of 182.33 against the pound and nearly a 2-week low of 141.88 against the U.S. dollar, from last week's closing quotes of 181.38 and 141.88, respectively. On the downside, 184.00 against the pound and 146.00 against the greenback are seen as the next support levels for the yen.

Against Australia, the New Zealand and the Canadian dollars, the yen slipped to 4-day lows of 94.70, 87.73 and 107.08 from last week's closing quotes of 93.85, 87.02 and 106.49, respectively. If the yen extends its downtrend, it is likely to find support around 97.00 against the aussie, 90.00 against the kiwi and 110.00 against the loonie.

Looking ahead, German retail sales data and import price data, both for June, Eurozone flash inflation data for July and quarterly national accounts data for second quarter and U.K. mortgage approvals data for June are due to be released in the European session.

In the New York session, U.S Chicago PMI for July is slated for release.