News Column

Dollar in mid-101 yen zone as market awaits Kuroda, Yellen comments

July 14, 2014

The U.S. dollar moved little in the mid-101 yen range Tuesday morning in Tokyo before Bank of Japan Governor Haruhiko Kuroda speaks to the press and U.S. Federal Reserve chief Janet Yellen appears before a congressional committee.

At noon, the dollar fetched 101.60-61 yen compared with 101.50-60 yen in New York and 101.47-48 yen in Tokyo at 5 p.m. Monday.

The euro was quoted at $1.3614-3615 and 138.33-34 yen against $1.3614-3624 and 138.24-34 yen in New York and $1.3635-3636 and 138.36-40 yen in Tokyo late Monday afternoon.

The dollar rose slightly against the yen in overnight trading as the safe-haven Japanese currency was sold against other currencies on receding worries about financial instability in Europe, dealers said.

But the U.S. currency's rally was limited by lingering concerns over major Portuguese lender Banco Espirito Santo SA, whose parent company was found to have "material irregularities" in its records, said Yasuaki Amatatsu, market analyst at the Bank of Tokyo-Mitsubishi UFJ.

Traders in Tokyo are now looking to Kuroda's press conference in the afternoon following a two-day meeting on monetary policy.

The central bank voted to maintain its ultraloose stance at the meeting and downgraded its outlook for economic growth in Japan in the current fiscal year to an average forecast by its Policy Board members of a 1.0 percent year-on-year increase from a 1.1 percent rise forecast in April.

Fed Chair Yellen is to speak before the U.S. Senate Banking Committee later Tuesday and the House Committee on Financial Services on Wednesday.

"Yellen is unlikely to give clues on the timing for the Fed to raise its benchmark interest rate from its current near-zero level...and will probably cite slackness in the U.S. labor market" as reasons for a continued accommodative stance, Amatatsu said.

The euro remained unchanged on Tuesday morning as European Central Bank chief Mario Draghi's speech in the European Parliament held no fresh surprises.

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Source: Japan Economic Newswire

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