Dollar takes breather ahead of rate decisions, data
Thursday, 4 October 2007
TOKYO, Oct 3 (AFP): The dollar was steady against other major currencies in Asian trade today as investors sat on their hands ahead of European interest rate decisions and a key US jobs report, dealers said.
The euro was steady at 1.4155 dollars in Tokyo morning trade against 1.4152 late Tuesday in New York.
The single currency has fallen from Monday's all-time high of 1.4283 dollars, hit by profit- taking and growing signs of unease among European officials about the strength of their currency, dealers said.
The dollar was flat at 115.70 yen after 115.71 while the euro inched down to 163.73 yen from 163.79.
Players took a breather on the eve of interest rate decisions by the European Central Bank (ECB) and the Bank of England (BoE) Thursday although both are expected to leave their benchmark rates unchanged for now.
Dealers will focus on comments by ECB chief Jean-Claude Trichet as markets speculate about whether the eurozone central bank will halt its run of interest rate rises and even consider loosening monetary policy.
A strong euro, which is bad for exporters, along with recent financial market volatility has dampened expectations of a further ECB rate hike.
The market is also waiting anxiously for US non- farm payrolls figures due Friday with traders wary of potential bad news like last month when an unexpected drop in employment spooked investors.
But "there has been talk that the August figures will be revised upwards, and that the September figures are not too bad," said Kazuhiko Shibata, Tokyo branch manager at Dresdner Bank.
"If we can confirm that, the dollar-selling trend can be reversed momentarily," he added.
News of a slump in August pending sales of existing US homes had a limited impact on trade as the market had already anticipated a housing market downturn, dealers said.
The US Federal Reserve slashed rates by 50 basis points last month to 4.75 per cent amid fears of a credit squeeze after several large banks revealed losses from mortgage-backed securities.
The euro was steady at 1.4155 dollars in Tokyo morning trade against 1.4152 late Tuesday in New York.
The single currency has fallen from Monday's all-time high of 1.4283 dollars, hit by profit- taking and growing signs of unease among European officials about the strength of their currency, dealers said.
The dollar was flat at 115.70 yen after 115.71 while the euro inched down to 163.73 yen from 163.79.
Players took a breather on the eve of interest rate decisions by the European Central Bank (ECB) and the Bank of England (BoE) Thursday although both are expected to leave their benchmark rates unchanged for now.
Dealers will focus on comments by ECB chief Jean-Claude Trichet as markets speculate about whether the eurozone central bank will halt its run of interest rate rises and even consider loosening monetary policy.
A strong euro, which is bad for exporters, along with recent financial market volatility has dampened expectations of a further ECB rate hike.
The market is also waiting anxiously for US non- farm payrolls figures due Friday with traders wary of potential bad news like last month when an unexpected drop in employment spooked investors.
But "there has been talk that the August figures will be revised upwards, and that the September figures are not too bad," said Kazuhiko Shibata, Tokyo branch manager at Dresdner Bank.
"If we can confirm that, the dollar-selling trend can be reversed momentarily," he added.
News of a slump in August pending sales of existing US homes had a limited impact on trade as the market had already anticipated a housing market downturn, dealers said.
The US Federal Reserve slashed rates by 50 basis points last month to 4.75 per cent amid fears of a credit squeeze after several large banks revealed losses from mortgage-backed securities.