Japanese Yen Advances Amid Risk Aversion After Weak U.S. GDP Data

The Japanese yen appreciated against its major counterparts in the New York session on Thursday, amid risk aversion as weak U.S. GDP data sparked fears about a recession.

Data from the Commerce Department showed that the U.S. economy contracted unexpectedly in the second quarter.

GDP decreased 0.9 percent in the second quarter, following a 1.6 percent decline in the first quarter. Economists had expected GDP to increase by 0.5 percent.

The data ignited concerns that the Fed's resolve to tame surging prices through aggressive monetary policy tightening is hurting economic growth.

Disappointing earnings results from Meta Platforms also weighed on U.S. stocks.

The yen rose to near a 2-month high of 136.37 against the euro and a 3-day high of 163.02 against the pound, following its prior lows of 139.34 and 166.08, respectively. If the yen strengthens further, it is likely to test resistance around 134.00 against the euro and 156.00 against the pound.

The yen touched a 4-week high of 134.34 against the greenback and a 2-week high of 140.43 against the franc, up from its early lows of 136.58 and 142.31, respectively. The yen is likely to find resistance around 121.00 against the greenback and 127.00 against the franc.

The yen firmed to a 2-week high of 84.24 against the kiwi, near 2-week high of 93.61 against the aussie and near a 3-week high of 104.57 against the loonie, off its previous lows of 85.55, 95.53 and 106.49, respectively. The yen may locate resistance around 81.00 against the kiwi, 90.00 against the aussie and 101.00 against the loonie.