Dollar on backfoot against euro in Asia
Thursday, 10 September 2009
TOKYO, Sept 9 (AFP): The dollar languished close to its 2009 low against the euro in Asia today, weighed down by increased risk taking and speculation about its future role in global trade.
The greenback was also lower versus most Asian currencies, with the exception of the yen.
The euro rose to 1.4502 dollars in Tokyo afternoon trade, up from 1.4480 in New York late Tuesday, when it had earlier hit 1.4535, the strongest since December 18.
The dollar gained to 92.47 yen from 92.31 yen. The euro climbed to 134.09 yen from 133.67.
Investors bought risky assets such as stocks and commodities as hopes mounted of a recovery in the global economy after the worst recession in decades, dealers said.
The weaker dollar lifted gold prices to an 18-month high above 1,000 dollars an ounce Tuesday, partly because the precious metal became more affordable but also because of dwindling confidence in the greenback, dealers said.
Another negative factor for the dollar was a report released this week by the UN Conference on Trade and Development calling for a reduction in the dollar's role as the primary currency for global trade-the first such proposal by a major international institution.
Market watchers say the tide may be turning against the dollar, which was seen as a safe-haven during a financial crisis that escalated almost a year ago with the collapse of Wall Street giant Lehman Brothers.
"Short-term players such as hedge funds have been decreasing their dollar holdings recently. The dollar may weaken across the board further if longer- term players join the bandwagon," Mitsuru Sahara, a senior dealer at Bank of Tokyo-Mitsubishi UFJ, told Dow Jones Newswires.
The dollar is being depressed by speculation that the US Federal Reserve may be slower than some other major central banks to raise its key interest rate from the current level of virtually zero.
Investors were waiting for the Fed's Beige Book survey of economic conditions in the United States due to be released later in the day for fresh leads on the outlook for the US economy and monetary policy.
Against Asian currencies, the dollar fell to 1,226.83 South Korean won from 1,231.90 a day earlier, to 1.4254 Singapore dollars from 1.4318 and to 9,925 Indonesian rupiah from 10,040.
It dropped to 32.69 Taiwan dollars from 32.80, to 48.34 Philippine pesos from 48.41 and to 34.02 Thai baht from 34.05.
The greenback was also lower versus most Asian currencies, with the exception of the yen.
The euro rose to 1.4502 dollars in Tokyo afternoon trade, up from 1.4480 in New York late Tuesday, when it had earlier hit 1.4535, the strongest since December 18.
The dollar gained to 92.47 yen from 92.31 yen. The euro climbed to 134.09 yen from 133.67.
Investors bought risky assets such as stocks and commodities as hopes mounted of a recovery in the global economy after the worst recession in decades, dealers said.
The weaker dollar lifted gold prices to an 18-month high above 1,000 dollars an ounce Tuesday, partly because the precious metal became more affordable but also because of dwindling confidence in the greenback, dealers said.
Another negative factor for the dollar was a report released this week by the UN Conference on Trade and Development calling for a reduction in the dollar's role as the primary currency for global trade-the first such proposal by a major international institution.
Market watchers say the tide may be turning against the dollar, which was seen as a safe-haven during a financial crisis that escalated almost a year ago with the collapse of Wall Street giant Lehman Brothers.
"Short-term players such as hedge funds have been decreasing their dollar holdings recently. The dollar may weaken across the board further if longer- term players join the bandwagon," Mitsuru Sahara, a senior dealer at Bank of Tokyo-Mitsubishi UFJ, told Dow Jones Newswires.
The dollar is being depressed by speculation that the US Federal Reserve may be slower than some other major central banks to raise its key interest rate from the current level of virtually zero.
Investors were waiting for the Fed's Beige Book survey of economic conditions in the United States due to be released later in the day for fresh leads on the outlook for the US economy and monetary policy.
Against Asian currencies, the dollar fell to 1,226.83 South Korean won from 1,231.90 a day earlier, to 1.4254 Singapore dollars from 1.4318 and to 9,925 Indonesian rupiah from 10,040.
It dropped to 32.69 Taiwan dollars from 32.80, to 48.34 Philippine pesos from 48.41 and to 34.02 Thai baht from 34.05.