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Yen Falls On GDP Data, Tokyo's Successful Olympics Bid

The Japanese yen slipped against other major currencies in early Asian deals on Monday, as regional stocks advanced after the country's GDP data was revised up in the second quarter and on Tokyo's successful bid to host Olympics for 2020.

The International Olympic Committee or IOC on Saturday awarded the 2020 Olympic and Paralympic Games to Tokyo, with the Asian city beating rival bids from Madrid and Istanbul to host the event.

The victory for Tokyo's bid would boost areas such as infrastructure and tourism and is expected to have a positive impact on the Japanese economy, as the country is struggling to come out of deflation.

Japan's gross domestic product was up 0.9 percent in the second quarter of 2013 compared to the previous three months, the Cabinet Office said in today's revised report.

The headline figure is up from the 0.6 percent increase that was suggested in the August 12 preliminary report. It also ended up being unchanged from the first quarter, although the revision was slightly below estimates for a gain of 1.0 percent.

On a yearly basis, GDP was revised up to 3.8 percent from last month's preliminary 2.6 percent. That was slightly shy of forecasts for a revision up to 3.9 percent, and it also was down from the 4.1 percent expansion in Q1.

According to data from the Ministry of Finance, Japan posted a current account surplus of 577.3 billion yen in July, beating expectations for a surplus of 539.6 billion yen following the 336.3 billion yen surplus in June.

The surplus shed 12.9 percent on year, also topping forecasts for a decline of 27.8 percent following the 20.3 percent plunge in the previous month.

The trade balance reflected a deficit of 943.3 billion yen versus forecasts for a shortfall of 862.4 billion yen following the 139.2 billion yen deficit a month earlier.

The yen reached as low as 100.10 against the greenback, down by 0.9 percent from last week's close of 99.11. The yen may probably face support around the 101.00 area.

The yen declined to a 4-day low of 106.61 against the franc, reversing from Friday's multi-week high of 105.16. If the yen continues its downtrend, it may test support around the 107.4 area

The yen fell to 156.51 against the pound, a level not seen since May 21. On the downside, the yen may aim support around the 157.3 level.

The yen touched a 4-day low of 131.85 against the euro, following a multi-day high of 129.92 hit on Friday. If the yen extends its bearish trend, its next possible support is seen around the 132.8 level.

The yen also slipped to more than a 5-week low of 96.13 against the loonie, 1-1/2-month lows of 79.99 against the kiwi and 92.07 against the aussie. Further breakdown may see the yen finding support around 93.00 against the aussie, 97.00 against the loonie and 80.5 against the kiwi.

The total number of home loans in Australia was up a seasonally adjusted 2.4 percent on month in July, the Australian Bureau of Statistics said today, standing at 52,204.

That beat forecasts for an increase of 2.0 percent following the downwardly revised 2.6 percent gain in June.

Looking ahead, Japan's consumer confidence index for August is due at 1:00 am ET.

At 1:45 am ET, Swiss unemployment rate for August is set for release.

In the European session, Swiss retail sales for July and Eurozone Sentix investor confidence index for September are slated for release.

Canada building permits data for July is expected at 8:30 am ET.

by RTTNews Staff Writer

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