Yen Retreats After BoJ Ueda Comments Add Rate Hike Uncertainty

The Japanese yen retreated from recent highs against other major currencies in the Asian session on Monday, after the Bank of Japan Governor Kazuo Ueda said the future interest rate decisions will be data-dependent and avoided giving clear idea about the timing of the next rate hike.

At each monetary policy meeting, the BoJ will make policy decisions based on its assessment of economic activity and prices with the data and information available at the time of each meeting, Ueda told business leaders in Nagoya.

"The actual timing of the adjustments will continue to depend on developments in economic activity and prices as well as financial conditions going forward," he said.

Ueda said the bank will pay due attention to various risk factors, such as the course of overseas economies, especially the US economy and developments in financial and capital markets.

He avoided giving clear idea about the timing of the next interest rate hike. Markets expect a quarter-point increase at the next meeting in December.

In economic news, data from the Cabinet Office showed that the total value of core machine orders in Japan was down a seasonally adjusted 0.7% on Month in September, coming in at 852.0 billion yen. That missed forecasts for an increase of 1.4 percent following the 1.9 percent contraction in August.

On a yearly basis, core machine orders fell 4.8 percent after slumping 3.4 percent in the previous month

In the Asian trading, the yen fell to 163.50 against the euro and 174.62 against the Swiss franc, from a recent near 1-month highs of 162.27 and 173.41, respectively. The yen may test support near 166.00 against the euro and 178.00 against the franc.

Against the U.S. dollar, the yen advanced to 155.14 from a recent 6-day high of 153.84. The next possible downside target is seen around the 160.00 region.

The yen edged up to 195.99 against the pound, from a recent high of 194.73. If the yen extends its downtrend, it is likely to find support around the 200.00 region.

Looking ahead, Canada housing starts for October and U.S. NAHB housing market index for November, are due to be released in the New York session.