The Japanese yen spiked up against other major currencies in the early Asian session on Wednesday on safe-haven appeal, as concerns over raising the U.S. debt ceiling limit resurfaced, which is critical to avoid a potentially disastrous debt default.
The treasury has been employing "extra ordinary measures" since the government reached statutory borrowing limit on December 31. The Treasury Department said those measures will be exhausted by mid-February
While President Barack Obama has indicated that he will not negotiate over raising the borrowing limit, Republicans have called for any increase in the debt ceiling to be tied to additional spending cuts.
The Japanese yen also saw buying demand as the country's Economics Minister Akira Amari expressed concern about excessive weak yen yesterday, as it will affect livelihood through import costs.
The World Bank today slashed the growth outlook for the global economy amid slow recovery in developed economies and weak growth in high-income nations.
The global economy is now expected to grow 2.4 percent in 2013 compared to the June forecast for a 3 percent expansion. The bank estimates 2012 global gross domestic product growth at 2.3 percent, weaker than previously estimated 2.5 percent.
In economic news, core machine orders in Japan jumped a seasonally adjusted 3.9 percent on month in November, the Cabinet Office said today.
That shattered forecasts for an increase of 0.3 percent following the 2.6 percent gain in October.
Data from the Bank of Japan showed that an index measuring prices of domestic corporate goods was up 0.3 percent on month in December, standing at 100.4. That beat forecasts for an increase of 0.2 percent following the flat reading in November.
On a yearly basis, the index dipped 0.6 percent versus forecasts for a decline of 0.7 percent following the 0.9 percent fall in the previous month
The yen that closed yesterday's deals at 88.80 against the greenback climbed 0.82 percent to a 6-day high of 88.07. The next upside target level for the yen is seen at 87.00.
The yen hit 94.64 against the franc, its highest level in a week. The yen thus advanced 0.69 percent from Tuesday's close of 95.30. If the yen gains further, it may break 94.00 level.
Against the euro and the pound, the yen strengthened to 6-day highs of 117.04 and 141.55 with 116.00 and 141.00, respectively seen as the next upside target levels. The yen ended yesterday's deals at 118.16 against the euro and 142.67 versus the pound.
The yen also firmed to 6-day highs of 93.05 against the aussie, 74.05 against the kiwi and 89.47 against the loonie. The next resistance level for the yen is seen at 92.5 against the aussie, 73.00 against the kiwi and 89.00 against the loonie.
Consumer confidence in Australia edged higher in January, according to survey results from Westpac Bank and the Melbourne Institute.
The group's confidence index increased 0.6 percent from December.
The reading of 100.6 indicated there were slightly more optimists than pessimists among those surveyed.
At 12:00 am ET, Japan consumer confidence index for December is due.
In the European session, Swiss retail sales for November and Eurozone CPI for December are slated for release.
From the U.S., CPI and industrial production for December, NAHB housing market index for January are expected in the American morning session.
At 2:00 pm ET, U.S. Fed will release its Beige book.
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Forex News
May 22, 2026 14:46 ET Minutes of the latest Fed policy session was the highlight of the week along with survey data on the U.S. housing market. In Europe, survey data signaled the trends in the euro area private sector. Further, consumer price inflation data from the U.K. was in focus. In Asia, various economic indicators from China drew attention to the health of the economy.