Dollar firms in Asian trade ahead of US data
Tuesday, 26 June 2007
TOKYO, June 25 (AFP): The dollar edged up towards a fresh four-and-a-half year high against the yen in Asian trade today as players braced for another batch of US economic data, dealers said.
They said the Japanese currency was likely to remain under pressure following its recent slide to multi-year lows against the dollar and to an all-time nadir versus the euro, pressured by Japan's low interest rates.
The dollar rose to 123.92 in Tokyo afternoon trade from 123.85 in New York late Friday when the unit had briefly hit 124.14 yen, the highest level since December 2002.
The euro slipped to 1.3459 dollars after 1.3467 and to 166.77 yen from 166.83, easing back from last week's record high against the Japanese currency.
"The market is not moving very much with traders expecting few surprises from this week's data," said Nobuo Kihara in forex sales at BNP Paribas.
The Federal Reserve kicks off a two-day policy meeting Wednesday and with the central bank widely expected to keep interest rates unchanged at 5.25 per cent, the focus will be on the accompanying statement for clues on the chances of further rate hikes in the future, dealers said.
The yen remained under pressure as expectations that Japanese interest rates will remain low for some time encouraged players to keep borrowing cheap credit in Japan to put into higher yielding currencies, dealers said.
"With the BoJ on hold, it's hard to see a bout of significant carry trade unwinding unless equity markets meltdown," Kyriakoupoulos wrote in a note to clients.
The dollar slipped to 926.70 South Korean won in Asian trade from 927.95 on Friday, to 1.5366 Singapore dollars from 1.5374 and to 32.737 Taiwan dollars from 32.759.
It rose to 8,995 Indonesian rupiah from 8,986.5 and to 34.56 Thai baht from 32.41, while holding steady at 46.06 Philippine pesos.
They said the Japanese currency was likely to remain under pressure following its recent slide to multi-year lows against the dollar and to an all-time nadir versus the euro, pressured by Japan's low interest rates.
The dollar rose to 123.92 in Tokyo afternoon trade from 123.85 in New York late Friday when the unit had briefly hit 124.14 yen, the highest level since December 2002.
The euro slipped to 1.3459 dollars after 1.3467 and to 166.77 yen from 166.83, easing back from last week's record high against the Japanese currency.
"The market is not moving very much with traders expecting few surprises from this week's data," said Nobuo Kihara in forex sales at BNP Paribas.
The Federal Reserve kicks off a two-day policy meeting Wednesday and with the central bank widely expected to keep interest rates unchanged at 5.25 per cent, the focus will be on the accompanying statement for clues on the chances of further rate hikes in the future, dealers said.
The yen remained under pressure as expectations that Japanese interest rates will remain low for some time encouraged players to keep borrowing cheap credit in Japan to put into higher yielding currencies, dealers said.
"With the BoJ on hold, it's hard to see a bout of significant carry trade unwinding unless equity markets meltdown," Kyriakoupoulos wrote in a note to clients.
The dollar slipped to 926.70 South Korean won in Asian trade from 927.95 on Friday, to 1.5366 Singapore dollars from 1.5374 and to 32.737 Taiwan dollars from 32.759.
It rose to 8,995 Indonesian rupiah from 8,986.5 and to 34.56 Thai baht from 32.41, while holding steady at 46.06 Philippine pesos.