TOKYO, Feb 12, 2008 (AFP) - The dollar was steady against the yen in Asian trade Tuesday after world finance chiefs refrained from taking any concrete measures to stabilise markets at a weekend meeting, dealers said.
They said the Tokyo market, which was closed on Monday for a national holiday, was still digesting the outcome of the G7 gathering, where ministers voiced concern about the increasingly uncertain global economic outlook.
The dollar was quoted at 106.90 yen in Tokyo morning trade compared with 106.94 in New York late on Monday.
The euro eased to 1.4502 dollars from 1.4517 and to 155.04 yen from 155.29.
Traders here showed some disappointment that the G7 had stopped short of announcing any specific measures to try to shore up their economies and markets, dealers said. The G7 also refrained from mentioning the weakness of the dollar.
The G7 statement "did not offer specific prescriptions to remedy market confusion due to the subprime mortgage problem," said Saburo Matsumoto, chief forex strategist for Sumitomo Trust Bank.
But dealers said the market impact was limited as most analysts had predicted ahead of the meeting that the G7 was unlikely to take coordinated action.
"It's true that market players feel disappointed about the statement, but they had not expected more in the first place," said Matsumoto.
Analysts said that the market was now looking ahead to Wednesday's release of US January retail sales figures, which could be key to shaping market sentiment this week.
In the eurozone, traders will take a close look at the ZEW survey of German investor confidence, due out later Wednesday, amid growing concerns about the impact in the region of the US economic slowdown.
Traders will also wait for fresh evidence of the extent of financial institutions' losses arising from the subprime mortgage crisis, dealers said.
"Major European banks are expected to announce earning reports this week, but market players are nevertheless in the wait-and-see mode here," said Mitsuru Sahara, senior manager in forex sales at Bank of Tokyo-Mitsubishi UFJ.
Subprime mortgages, granted to Americans with poor credit, have experienced high default and foreclosure rates in the past year amid a widespread housing market slump.
Dealers said the yen could be poised to rise as traders have already taken out substantial short, or sell, positions on the currency.
"Everyone thinks the yen will rise," said Sahara. "I think they are looking for an incentive to reverse their short positions."
oh/dr/lh
Forex-Asia
