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Yen Strengthens As Japanese Prime Minister Shinzo Abe To Resign

japaneseyen july31 28aug20 lt

The Japanese yen moved up against its major counterparts in the Asian session on Friday, following reports that Japanese Prime Minister Shinzo Abe is planning to step down due to the worsening of a chronic illness.

National broadcaster NHK reported that Abe's illness has worsened and he wanted to avoid administration issues.

Concerns over Abe's health had risen after he made two hospital visits within a week. He has been undergoing treatment for ulcerative colitis disease for years.

Deputy Prime Minister Taro Aso is expected take over as acting Prime Minister.

The Japanese stock market slumped, while the yen spiked up on news of Abe's resignation.

Data from the Ministry of Internal Affairs showed that Japanese Tokyo inflation eased in August after rising in the previous month.

The consumer price index increased 0.3 percent year-on-year in August, slower than the 0.6 percent rise July. In June, inflation was 0.3 percent.

The yen fell against its major peers on Thursday, except the greenback.

The yen appreciated to 106.00 against the greenback, up by 0.9 percent from a 2-week low of 106.95 seen at 11:45 pm ET. The pair was worth 106.56 at yesterday's close. The yen is seen facing resistance around the 104.00 mark.

The yen was 0.6 percent higher at 125.96 against the euro, following more than a 1-year decline to 126.77 at 12:00 am ET. The yen is likely to face resistance around the 122.5 region, if it gains again.

After falling to near a 2-year low of 117.88 at 11:45 pm ET, the yen reversed its course against the franc and was trading higher at 117.19. Should the yen strengthens further, it is likely to test resistance around the 113.00 region.

Having declined to a 6-month low of 141.62 against the pound at 11:30 pm ET, the yen bounced off to 140.67 following the news. Next immediate resistance for the yen is likely seen around the 138.00 level.

The yen rebounded modestly to 77.36 against the aussie, from more than a 1-year low of 77.96 seen at 11:40 pm ET. The yen may challenge resistance around the 76.00 mark.

Following a fresh 5-week fall to 71.26 at 11:30 pm ET, the Japanese yen recovered to 70.71 against the kiwi. Continuation of the yen's uptrend may lead it to a resistance around the 69.00 region.

The yen was up at 80.96 against the loonie, reversing from near a 3-month low of 81.58 it recorded at 11:45 pm ET. At yesterday's trading close, the pair was quoted at 81.14. Further rally in the currency may find resistance around the 78.00 region.

Looking ahead, Eurozone economic confidence index is due in the European session.

In the New York session, Canada GDP data for the second quarter, U.S. personal income and spending data and wholesale inventories for July and University of Michigan's final consumer sentiment for August are scheduled for release.

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