News Column

Dollar edges down to mid-101 yen after Japan's weak GDP data

February 16, 2014

TOKYO, Feb. 17 -- (Kyodo) _ The U.S. dollar edged down to the mid-101 yen zone Monday morning in Tokyo, as Japan's weaker-than-expected economic growth data stirred a risk-averse mood and prompted the purchase of the safe-haven yen.

At noon, the dollar fetched 101.62-63 yen compared with 101.74-84 yen in New York and 101.82-84 yen in Tokyo at 5 p.m. Friday.

The euro was quoted at $1.3712-3713 and 139.34-37 yen against $1.3687-3697 and 139.39-49 yen in New York and $1.3707-3709 and 139.57-61 yen in Tokyo late Friday afternoon.

The U.S. currency briefly fell below the 101.50 line in morning trading, after the Japanese government said its economy grew an annualized 1.0 percent in real terms during the last quarter of 2013, against the average market forecast of 2.6 percent.

"Usually, bearish gross domestic product data prompts the selling of a country's currency. However, Japan is currently in a special situation," said Yuzo Sakai, manager of foreign exchange business promotion at Tokyo Forex & Ueda Harlow.

The GDP data led market players to question the efficacy of the "Abenomics" policies being spearheaded by Prime Minister Shinzo Abe, prompting them to refrain from investment risks and buy the yen, considered a relatively safe asset, against the dollar, Sakai said.

The dollar's decline also stemmed from a recent series of sluggish U.S. economic figures including manufacturing output in January released on Friday, raising uncertainty over the outlook for the U.S. economy, dealers said.

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Source: Japan Economic Newswire

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