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USD/JPY drops to 116.40 on Abe’s remarks

FXStreet (Edinburgh) - The Japanese yen is now picking up pace vs. the US dollar, dragging USD/JPY to test session lows in the 116.45/40 band.

USD/JPY down from 2014 peaks

After briefly visiting levels just above 117.00 the figure, the pair quickly retreated to test intraday lows around 116.40 following the press conference by Japanese PM Shinzo Abe. In line with market expectations, Abe called for snap elections to be held on December 14th and announced the delay of the second sale tax for 18 months. The announcements follow the recent dismal GDP figures from the Japanese economy during the third quarter, contracting at an annual pace of 1.6% and thus slipping back into recession territory.

USD/JPY levels to consider

At the moment the pair is up 0.25% at 116.74 with the next resistance at 117.06 (2014 high Nov.17) ahead of 117.20 (high Oct.17 2007) and finally 117.95 (high Oct.15 2007). On the flip side, a breach of 116.43 (low Nov.18) would aim for 116.00 (psychological level) and then 115.85 (hourly low Nov.17).

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