News Column

Dollar stays near 102 yen line in morning

June 22, 2014

The U.S. dollar stayed near the 102 yen line Monday morning in Tokyo, receiving little boost from an upbeat private report on China's manufacturing sector, as continuing concerns over geopolitical risks in Iraq and Ukraine capped its upside.

At noon, the dollar fetched 101.97-102.01 yen compared with 102.01-11 yen in New York and 101.91-92 yen in Tokyo at 5 p.m. Friday.

The euro was quoted at $1.3605-3607 and 138.73-76 yen against $1.3596-3606 and 138.78-88 yen in New York and $1.3610-3611 and 138.70-74 yen in Tokyo late Friday afternoon.

The dollar was confined in a narrow range in the morning, after recovering to the 102 yen line on Friday in overseas trading, underpinned by upbeat U.S. stock markets.

The 30-issue Dow Jones Industrial Average rose Friday for the sixth consecutive trading day to hit a fresh record high. Tokyo shares followed suit, with the 225-issue Nikkei Stock Average hitting a five-month intraday high in the morning.

The dollar failed to gain further ground despite data showing positive signs in the world's second largest economy.

The HSBC Flash China Manufacturing Purchasing Managers' Index for June rose to 50.8 from 49.4 the previous month, rising above the boom-and-bust line of 50 for the first time since December last year.

"In ordinary circumstances, the dollar would strengthen against the yen on the back of rises in shares at home and abroad and positive Chinese data. However, that was not the case this time," said Yuzo Sakai, manager of foreign exchange business promotion at Tokyo Forex & Ueda Harlow.

"I think it's because U.S. long-term interest rates are still not so high and concerns about the situations in Iraq and Ukraine continue," he said.

Market players are expected to keep close tabs on Eurozone PMI data for June and U.S. existing home sales data for May, both due out later in the day, for fresh trading clues.

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Source: Japan Economic Newswire

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