News Column

Dollar hovers on firm note in lower 104 yen range in Tokyo

August 31, 2014



The U.S. dollar moved narrowly in the lower 104 yen range Monday morning in Tokyo, maintaining its firmness in New York on Friday.

At noon, the dollar fetched 104.16-23 yen compared with 104.06-16 yen in New York and 103.82-84 yen in Tokyo at 5 p.m. Friday.

The euro was quoted at $1.3124-3124 and 136.69-70 yen against $1.3127-3137 and 136.65-75 yen in New York and $1.3169-3170 and 136.72-76 yen in Tokyo late Friday afternoon.

The U.S. dollar's firmness in Tokyo on Monday morning was in part traced to speculation over the European Central Bank's monetary policy ahead of its policy meeting on Thursday.

"Some market players are beginning to say the ECB will ease further this week," said Kengo Suzuki, chief foreign exchange strategist at Mizuho Securities Co.

"There's also speculation the U.S. Federal Reserve will make a hawkish tweak in their forward guidance this month. Expectation of moves that could lead to wider interest rate gaps between the United States and Europe is prompting market players to buy the dollar and sell the euro," he said.

Fed chair Janet Yellen said in August the central bank could raise its benchmark rate earlier if the U.S. labor market continues to top expectations.

Traders will look to a number of U.S. economic indicators this week, including August manufacturing data due Tuesday and August payrolls data due Friday for further clues on the Fed's direction, dealers said.

Also behind the euro's slip below $1.3120, a fresh one-year low against the U.S. currency, Monday morning were concerns over the turmoil in Ukraine.

The euro fell after Ukrainian media reported Pro-Russian separatists fired on Ukrainian ships in the Sea of Azov on Sunday, a day after the United States and the European Union announced readiness to place new economic sanctions on Moscow over the conflict.



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Source: Japan Economic Newswire


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