Dollar mixed in Asian trade ahead of US data
Tuesday, 12 June 2007
TOKYO, June 11 (AFP): The dollar was narrowly mixed in Asian trade today as the market waited for a batch of US economic reports amid fresh concerns about the outlook for inflation and interest rates, dealers said.
They said the market was largely unaffected by an upgrade to Japan's first-quarter economic growth which had been generally expected.
The dollar eased to 121.61 yen in Tokyo afternoon trade from 121.74 in New York late last Friday.
The euro slipped to 1.3353 dollars from 1.3369 and to 162.39 yen from 162.75.
"The dollar is generally supported against the yen as the market focuses on US monetary policy," said Commerz Bank treasurer Ryohei Muramatsu, noting that expectations were shifting from a possible US rate cut to a potential hike.
The US Federal Reserve has kept interest rates unchanged for a year at 5.25 per cent but continues to voice concern about inflation, making players all the more nervous ahead of Friday's US consumer price figures and the Fed's Beige Book economic report on Wednesday, dealers said.
"As the market had already priced-in the likelihood of an upward revision, the strong revised data failed to induce buying interest in the yen," said Mitsubishi UFJ Securities foreign exchange manager Minoru Shioiri.
Dealers said the market has already priced in a rate hike sometime in the second half of 2007 after the July upper house elections.
"Japan's fundamental economic indicators have not been that strong," said Commerzbank's Muramatsu, predicting that Fukui would take a similar line as before with little impact likely on the market.
Fukui has repeatedly warned of the dangers of keeping interest rates very low for too long but he faces political resistance to an early rate hike, particularly with consumer prices falling again.
The dollar firmed to 1.5427 Singapore dollars from 1.5376 on Friday, to 931.90 South Korean won from 929.55, to 9,095 Indonesian rupiah from 9,060.
The greenback eased to 32.55 Thai baht from 32.67, to 46.22 Philippine pesos from 46.32, and to 33.017 Taiwan dollars from 33.026.
They said the market was largely unaffected by an upgrade to Japan's first-quarter economic growth which had been generally expected.
The dollar eased to 121.61 yen in Tokyo afternoon trade from 121.74 in New York late last Friday.
The euro slipped to 1.3353 dollars from 1.3369 and to 162.39 yen from 162.75.
"The dollar is generally supported against the yen as the market focuses on US monetary policy," said Commerz Bank treasurer Ryohei Muramatsu, noting that expectations were shifting from a possible US rate cut to a potential hike.
The US Federal Reserve has kept interest rates unchanged for a year at 5.25 per cent but continues to voice concern about inflation, making players all the more nervous ahead of Friday's US consumer price figures and the Fed's Beige Book economic report on Wednesday, dealers said.
"As the market had already priced-in the likelihood of an upward revision, the strong revised data failed to induce buying interest in the yen," said Mitsubishi UFJ Securities foreign exchange manager Minoru Shioiri.
Dealers said the market has already priced in a rate hike sometime in the second half of 2007 after the July upper house elections.
"Japan's fundamental economic indicators have not been that strong," said Commerzbank's Muramatsu, predicting that Fukui would take a similar line as before with little impact likely on the market.
Fukui has repeatedly warned of the dangers of keeping interest rates very low for too long but he faces political resistance to an early rate hike, particularly with consumer prices falling again.
The dollar firmed to 1.5427 Singapore dollars from 1.5376 on Friday, to 931.90 South Korean won from 929.55, to 9,095 Indonesian rupiah from 9,060.
The greenback eased to 32.55 Thai baht from 32.67, to 46.22 Philippine pesos from 46.32, and to 33.017 Taiwan dollars from 33.026.