TOKYO: The yen came under pressure in Asia on Wednesday after Japan's trade surplus plunged in the aftermath of last month's devastating earthquake and tsunami, dealers said.
The dollar fetched 82.92 yen in Tokyo morning trading against 82.57 yen in New York late Tuesday.
The euro rose to $1.4386 from $1.4334. The single European currency firmed to 119.30 yen from 118.35.
Official data released Wednesday showed that Japan's trade surplus dived 78.9 percent in March from a year earlier, as exports fell after a March 11 earthquake and tsunami that triggered a nuclear crisis.
The surplus reached 196.5 billion yen ($2.37 billion), still managing to stay in the black for the second straight month. The trade surplus was driven down by weak vehicle exports.
"As the data showed a clear picture of sluggish exports, the market moved to dollar buying against the yen, although the reaction proved short lived," said Sumino Kamei, senior analyst at the Bank of Tokyo Mitsubishi UFJ.
"The data revealed a steep decline in automobile exports. As the supply chain damaged by the quake has not been restored yet, it is seen to take time until automobile exports will recover," Kamei said.
The euro firmed as investor risk appetite emerged after a recent resurfacing sovereign debt worries for the eurozone.
"The euro showed resilience as expectations for a eurozone rate hike resurfaced," Kamei said
The European currency got support from preliminary results from eurozone composite purchasing managers' index by London based researchers Markit released Tuesday, dealers said.
The data showed that economic activity in the 17-nation currency bloc expanded in April at the second-fastest rate since mid-2007.
"Still, the sovereign debt problem remains unresolved," Kamei said. "The market may be swayed again depending on the outcome of Spanish bond auction scheduled later in the day."
Comments
Comments are closed.