Dollar holds firm after soaring on Fed minutes

TOKYO: The dollar held firm in Asian trade Thursday after leaping on Federal Reserve minutes which suggested the central bank could exit its ultra-loose monetary policy sooner than expected.

The dollar was at 93.62 yen in Tokyo midday trade, unchanged from Wednesday afternoon in New York where the greenback soared on the Fed minutes.

The dollar also maintained its overnight strength against the British pound, changing hands at $1.5228 compared with $1.5231 in US trade.

The euro bought $1.3277 against $1.3283 in US trade and 124.26 yen against 124.37 yen.

The Fed minutes of its latest policy meeting showed divisions over asset purchases to boost the economy.

A "number" of participants said that an ongoing evaluation of the $85 billion per month asset purchases "might well lead the committee to taper or end its purchases before it judged that a substantial improvement in the outlook for the labour market had occurred," the minutes said.

The Fed minutes of the January meeting "showed rising concern about the risks of more quantitative easing," National Australia Bank said in a note.

"Several members indicated that the Fed should be prepared to vary the pace of the current $85 billion per month asset purchase programme although there is still widespread opinion as to whether the purchases should be cut back before a substantial improvement occurs in the labour market," it said.

Following the dollar's rally on the Fed minutes, the focus will shift to a string of US indicators due later Thursday, said Junichi Ishikawa, market analyst at IG Securities in Tokyo.

The greenback could rise to near the 94.00-yen level if the February Philadelphia business outlook survey shows an improvement from the previous month as forecasts indicate, he told Dow Jones Newswires.

On the other hand below-view figures could lead to a correction in the dollar's rise, he said. US January consumer prices and weekly jobless claims are also on the roster.

The flash estimate of French, German and eurozone surveys for both manufacturing and service sector activity will also be released.