WORLD FOREX: Dollar, Euro Gain Moderately Against Yen

Friday, Mar 23, 2012

-- Dollar, euro gain modestly against yen

-- Market focusing on Federal Reserve Chairman Ben Bernanke's speech, U.S. new residential sales figures for February later in day

-- Japan taps BNP Paribas economist as candidate for Bank of Japan policy board, but little impact expected on monetary policy, market


 
   By Alexander Martin 
   Of DOW JONES NEWSWIRES

TOKYO (Dow Jones)--The dollar and euro gained modestly against the yen during Asian trading Friday as investor risk appetite seemed to pick up somewhat following Thursday's weak China and European PMI data.

Analysts said the dollar remained firm against the yen, although its immediate gains also seemed limited as heightened worries over slowing global economic growth improved the yen's appeal as a safe-haven currency.

"The market seems to be more focused at this point on negative news rather than positive news," said Junichi Ishikawa, forex analyst at IG Market Securities in Tokyo. He added that the greenback could slide against the yen if U.S. new residential sales figures for February to be released at 1400 GMT are lower than market expectations.

A Dow Jones survey of economists forecasts sales of new homes to check in at 325,000, a 1.2% rise from the previous month.

But Ishikawa said the greenback's uptrend, which saw it hit an 11-month high of Y84.18 on March 15, was still in place, adding that he sees it rising back near the Y84.00 level over the next week.

As of 0450 GMT, the dollar was at Y82.76 from Y82.55 in late New York trading Thursday, according to trading platform EBS. The euro was at $1.3205 from $1.3200 while it was at Y109.30 from Y108.96.

Analysts said a move by the Japanese government on Friday to propose BNP Paribas Chief Economist Ryutaro Kono as a candidate to replace an outgoing member of the Bank of Japan's policy board was not expected to affect the central bank's easy money policy.

Minori Uchida, senior analyst at the Bank of Tokyo-Mitsubishi UFJ, said such member changes in the nine-person board are expected to have a "limited impact" on the market.

With many central banks, including the BOJ, embracing a looser monetary policy, St. Louis Federal Reserve Bank President James Bullard said during an interview with Dow Jones that he saw inflationary risks for the U.S. and the rest of the world this year.

He also said he expected the Fed to keep its monetary policy steady for several months, despite signs of an improving domestic economy.

Data released Thursday saw new unemployment insurance claims in the U.S. fall by 5,000 to a seasonally adjusted 348,000 last week, the lowest level since March 2008.

After the U.S. new residential sales figures, attention will switch to Fed chairman Ben Bernanke's speech at 1745 GMT and any comments he makes on the outlook of the U.S. economy.

The ICE Dollar Index, which tracks the U.S. dollar against a basket of currencies, was at 79.661 from 79.642.


 
Interbank Foreign Exchange Rates At 2350 EST / 0450 GMT 
 
                          Latest       Previous   %Chg    Daily    Daily   %Chg 
Dollar Rates                             Close            High      Low    12/31 
 
USD/JPY Japan            82.77-80       82.52-56  +0.30    82.85    82.52  +7.63 
EUR/USD Euro            1.3204-06     1.3199-203  +0.03   1.3211   1.3193  +1.89 
GBP/USD U.K.            1.5819-22      1.5819-23   0.00   1.5827   1.5812  +1.79 
USD/CHF Switzerland     0.9128-30      0.9131-36  -0.05   0.9138   0.9126  -2.60 
USD/CAD Canada      0.9998-1.0000      0.9987-92  +0.10   1.0000   0.9988  -2.07 
AUD/USD Australia      1.0396-400      1.0387-92  +0.08   1.0412   1.0386  +1.86 
NZD/USD New Zealand     0.8111-16      0.8092-97  +0.24   0.8127   0.8094  +4.34 
 
Euro Rate 
 
EUR/JPY Japan           109.28-30      108.93-97  +0.31   109.40   108.86  +9.77 
 
Source: ICAP Plc.