Dollar gains in Asia on Fed meeting minutes
May 23, 2014, 12:05 am TWN
TOKYO--The dollar rallied in Asia Thursday after solid Chinese data and minutes from the Federal Reserve's April policy meeting that showed it would forge ahead with a cautious wind-down of its stimulus program.
In Tokyo, the greenback rose to 101.71 yen, up from 101.38 yen late in New York and much stronger than the 100.90 yen level touched in Tokyo earlier Wednesday.
The euro also gained on the Japanese currency at 139.07 yen, up from 138.76 yen in U.S. trade, as Tokyo's benchmark Nikkei stock index added more than 2.0 percent by the close on upbeat sentiment.
The European single currency also slipped to US$1.3673 from US$1.3686 as investors bet the European Central Bank will ease monetary policy next month to shore up the 18-nation eurozone economy.
The Chinese yuan rose to 16.28 yen from 16.19 yen Wednesday afternoon.
Investors tend to buy the yen, seen as a safe-haven currency, in times of uncertainty or turmoil and sell it when those concerns ease.
“The market has turned to a risk-on mode,” Yuji Kameoka, chief FX strategist at Daiwa Securities, told Dow Jones Newswires.
“If the economic recovery spreads on a worldwide basis, the yen is vulnerable to weaken.”
The dollar had turned down against the yen in Asia on Wednesday after the Bank of Japan doused expectations of more easing measures in coming months, saying the economy was improving despite concern that a sales tax rise will dent consumer spending and derail a recovery.
The dollar was mostly lower against other Asia-Pacific currencies on Thursday.
It weakened to 58.61 Indian rupees from 58.82 rupees, to 43.72 Philippine pesos from 43.77 pesos, to 1,024.75 South Korean won from 1,027.15 won, to SG$1.2509 from SG$1.2531.
The U.S. unit firmed to 11,526.80 Indonesian rupiah from 11,502.50 rupiah. The Australian dollar rose to 92.66 U.S. cents from 92.30 cents.