Markets

Dollar mixed in Asia after upbeat housing, jobs data

Published January 18, 2013 Updated January 18, 2013 09:22am


The greenback bought 90.10 yen, against 89.86 yen in New York on Thursday, while the euro fetched 120.63 yen against 120.20 yen.

 

The single currency was quoted at $1.3385, from $1.3375 in US trade.

 

A fall in weekly US jobless claims, a sign of the pace of layoffs, and a rebound in housing starts in December helped the dollar, while the euro won support from a solid Spanish bond auction, dealers said.

 

The yen's seesaw trade in recent days follows a string of reports in Japanese media suggesting the central bank, under pressure from the new government, will launch fresh easing at a policy meeting next week and strike a deal with Tokyo to set a two-percent inflation target.

 

Japan's economic revitalisation minister Akira Amari said the BoJ and government had yet to reach agreement on a joint statement committing to the inflation target, after a meeting Friday with Finance Minister Taro Aso and BoJ chief Masaaki Shirakawa.

 

But "things are going in a good direction. I think we'll be able to announce something after the BoJ meeting next week", Amari was quoted by Dow Jones Newswires as saying.

 

The inflation target is part of the government's bid to kickstart the limp Japanese economy, and was one of the Liberal Democratic Party's promises ahead of a general election it won by a landslide last month.

 

Amari sparked a yen rally earlier this week when he said a rapid fall in the unit could hurt the economy as it would make the cost of imported goods rise.

 

However, the yen quickly fell back after he said the remarks were misinterpreted, telling the The Wall Street Journal Thursday that "my view is that the currency market is still in a phase of correcting from excessive yen strength. That was the case back then, and is the case now."

 

The yen fell further Friday afternoon after Koichi Hamada, special economic advisor to Prime Minister Shinzo Abe's cabinet, renewed calls for aggressive BoJ easing and said worries over the yen's current level were overblown.

 

"If it goes to 110 yen...then we should be worried about it. But 100 or 95 is nothing to worry about."

 

The dollar was mixed against other Asia-Pacific currencies, falling to 40.56 Philippine pesos from 40.62 pesos on Thursday, to 1,055.81 South Korean won from 1,058.11 won and to 53.95 Indian rupees from 54.63 rupees.

 

The greenback also slipped to 9,640 Indonesian rupiah from 9,710 rupiah, to Tw$28.95 from Tw$28.98 and to 29.78 Thai baht from 29.86 Thai baht. It rose to Sg$1.2254 from Sg$1.2244.

 

The Australian dollar edged up to $1.0524 from $1.0510, helped by upbeat Chinese economic data, while China's yuan was stronger at 14.48 yen against 14.25 yen.

 

Copyright AFP (Agence France-Presse), 2013