Early today, Japan released its GDP numbers for last quarter. The data showed the economy expanded by 0.5%, which was lower than the 0.9% expected by traders. Nonetheless, the growth continued a growth not seen in more than 28 years.
The impressive data shows a sustained growth put forward by Prime Minister Abe. It also puts increased pressure to Bank of Japan (BOJ) which has continued to support the economy with low interest rates and stimulus packages.
The released data showed that exports, a key component of the economy contributed less to growth because exports were offset by a sharp increase in imports.
The data helped the currency pair cross the significant support level of 107.50. This is the highest the yen has been since November 2016.
Later today, traders will be paying a close attention to the inflation data from the United States. This will potentially be the most important data since traders have already started getting worried about the rise in inflation.
The sustained improvement in the Japanese economy, coupled with the inflation risks in the United States could help push the pair down further.