Friday June 26, 2009
TOKYO: The dollar lost ground against the yen and the euro in Asian trade on Friday on expectations that US interest rates will remain low for some time, dealers said.
The dollar was changing hands at 95.68 yen in Tokyo morning trade, down from 95.95 yen in New York late Thursday. The euro rose to 1.4033 dollars from 1.3986 and to 134.32 yen from 134.26.
Lower US bond yields reduced demand for the greenback, dealers said. Investors tend to favour currencies offering higher returns. "The dollar faced
selling, reflecting drops in long-term interest rates," said Yuji Saito, forex head at Societe Generale.
The market was still digesting Wednesday's decision by the US Federal Reserve to leave its stimulative monetary policy unchanged; giving no sign that it was preparing to scale back its pump-priming measures.
Gains on global stock markets also encouraged investors to take more risk, dampening demand for the safe-haven dollar, dealers said.
The market is now waiting for the release next week of key US jobs data, dealers said. "We want to watch if funds will be flowing from the safe-haven dollar and yen into riskier currencies next week" on the back of improving investor confidence, Saito said.
Meanwhile data showed the US economy contracted at a 5.5 percent pace in the first quarter, not as bad as the previous estimate of a 5.7 percent drop.
Analysts said this was consistent with other signals that the worst slump in decades may soon be over.
(AFP)
TOKYO: The dollar lost ground against the yen and the euro in Asian trade on Friday on expectations that US interest rates will remain low for some time, dealers said.The dollar was changing hands at 95.68 yen in Tokyo morning trade, down from 95.95 yen in New York late Thursday. The euro rose to 1.4033 dollars from 1.3986 and to 134.32 yen from 134.26.
Lower US bond yields reduced demand for the greenback, dealers said. Investors tend to favour currencies offering higher returns. "The dollar faced
selling, reflecting drops in long-term interest rates," said Yuji Saito, forex head at Societe Generale.The market was still digesting Wednesday's decision by the US Federal Reserve to leave its stimulative monetary policy unchanged; giving no sign that it was preparing to scale back its pump-priming measures.
Gains on global stock markets also encouraged investors to take more risk, dampening demand for the safe-haven dollar, dealers said.
The market is now waiting for the release next week of key US jobs data, dealers said. "We want to watch if funds will be flowing from the safe-haven dollar and yen into riskier currencies next week" on the back of improving investor confidence, Saito said.
Meanwhile data showed the US economy contracted at a 5.5 percent pace in the first quarter, not as bad as the previous estimate of a 5.7 percent drop.
Analysts said this was consistent with other signals that the worst slump in decades may soon be over.
(AFP)
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